The last legislation governing the Trustee Savings Banks was in 1863 and we know how times have changed. At that time a pound was 240p and now it is only 100p. The whole situation has changed and we have to update our legislation.
I welcome the Bill because it is very forward looking and is a Bill that will bring us to the end of the 1990s and into the year 2000 and further. The Bill is very important. As things stood the Trustee Savings Banks were an extension of the credit unions and were for small investors. Now the Trustee Savings Banks are facing big competition and probably in a few years time will be facing even more competition from the Continent. As we know from what the Minister has told us banks on the Continent have been changed enormously over the years. They updated their legislation but we left our legislation as it was apart from a few amendments here and there. There is an old country saying that we put a bush in a gap now and then when there was need to but we never really sat down to look at the whole situation.
At the present time particularly it is important that the Trustee Savings Banks get into the big league because those in local authorities know how the cartels are operating and are charging local authorities for transacting their business anything from £30,000 to £100,000 a year despite the fact that they are making huge sums in interest on those local authorities. They had no opposition, they could agree among themselves and there was no regard for the small man. Even though the local authorities spend from £15 million up to £100 million, nevertheless they are treated now just as small fellows and are told to pay.
That is a challenge to industry. I believe when this legislation gets through and when they get into the big league the Trustee Savings Banks will be able to compete against some of our larger banks and they will be able to take on those accounts from local authorities. Up to now they could only deal with small depositors but when this Bill is enacted they will be able to deal with companies. We have a lot of small companies now who want finance and the large banks do not give them the attention and the care they should give them. I believe when the Trustee Savings Banks get into the bigger league, the vast experience they have gained over the years in dealing with small depositors and handling small accounts will help them to deal with their customers in a more humanitarian manner than some of the bigger outlets we have at the moment. It will be a great advantage because we must get more people into the money market and supply the service the people need.
We know the range of the Trustee Savings Banks are restricted at present to deposit taking and making loans which in the opinion of the Minister for Finance contribute to thrift. That word thrift is very important because it will encourage the smaller people who have been putting money into the savings deposit accounts to learn how they may invest their savings better. There will be finance advice available in those banks and they will be able to update their knowledge. That will encourage even more thrift among the ordinary people in the country who have only a week's wages and put a few pounds away. They will now be able to get better advice and they will be able to compete.
I am very enthusiastic about this Bill. One of my arguments has been the way the big banks are treating the local authorities. They have been getting dreadful bills and are not able to seek finance elsewhere. As chairman of my county council I would certainly approach the Trustee Savings Banks to see if they could come up with a better deal for local authorities. They are now opening offices in rural areas and in the main towns around the country. At one time they were only in Dublin. Then they opened in Limerick and Cork, but now they are in Sligo and in a number of provincial towns.
As they expand into the various towns there is no reason we could not ask them to quote for business which would save all the people quite a lot of money instead of having to pay those new banking charges which we are opposing, and which we will continue to oppose. If you impose charges on local authorities it is on the ordinary people you are imposing the charges. The local authorities are only doing the work for the ordinary people. We cannot continue taking it off the people working on jobs here and there around the country and giving it to those vast complexes that are making millions of pounds profit every year. It has to be stopped and I believe this Bill and the Trustee Savings Banks will assist us.
Another thing I like is that the Trustee Savings Banks can alter their rates as they see fit, subject to the condition that the rights of depositors are fully protected in relation to the deposit and interest thereon under any amending legislation in accordance with accepted practice. It is very important even though those banks are starting to expand, that the deposit is guaranteed because we know over the years there were incidents of deposits not being fully guaranteed. It is provided under this Bill that there will be no danger whatever of any depositor losing his investment.
It is also stated in the Bill that the competition may make it necessary for them to become associated with larger financial groupings and form a joint venture. It is good that is included in the Bill. Joint venture is being talked about a lot today and the private sector and the public sector can get together to provide services at a more competitive rate.
I am pleased that that option is there. I have no doubt if that was not implemented that bigger European banks could take over banks such as the Trustee Savings Banks after 1992. This Bill will give them the opportunity to get into enterprises and different businesses overseas. There seems to be a lot of banking activity going on between our banks and overseas banks. The Trustee Savings Banks will now be in the main league and they will be able to take their place, to keep the small depositor to the fore and give him a bigger and broader base. In that way we will see the Trustee Savings Banks as a bigger, a more positive, a more productive and a much better unit to serve their depositors and the people. I congratulate the Minister on bringing in this Bill. I welcome it and know it will be a great success.