Bayly AndrewANDREW BAYLY (National—Hunua): Thank you and it's a pleasure to be talking at the third reading of this important bill the Friendly Societies and Credit Unions (Regulatory Improvements) Amendment Bill. Of course after that last speech I thought we needed to move on to some new areas of discussion. But before I do that I just want to acknowledge the sponsor of this bill Stuart Smith. He is a dynamic local MP. He is one of the best MPs I've seen in this place.Rt Hon David Carter: The member could learn something from him!ANDREW BAYLY: Yes I could. I could learn something from him. He represents the people of Kaikōura in a very good fashion—very conscientious. And of course he is an expert in financial matters and that's why I think it's most appropriate that he was promoting this bill which I've got to say was at times slightly testy and we had a whole range of submitters. It showed to me that this was a dynamic industry where we don't just have everyone aligned and trying to be self-serving when seeking a change to this piece of legislation. We have real tension across the industry. Most of them wanted many of the changes that we put in place and some didn't. And I think that's a hallmark of a dynamic industry as well.And of course what this is about this important bill which we're going to talk about and hopefully pass today is something that brings New Zealand into the modern age. And we've just heard that it's a very old Act and what this does is allow New Zealand credit unions and friendly societies to operate in a much more effective and I've got to say I think a commercial manner.And of course I think that most people forget how big the credit union / friendly society industry is. I was fascinated to see that there are 235 million members overseas in 109 countries with 68000 credit unions. In New Zealand we have roughly 200000 members and we've got about $2 billion worth of assets—financial products—that they're holding on behalf of their members. And I think from the perspective of what we're trying to achieve the 1982 Act was very inefficient. The wording was out of date. And what this has done is bring us up into the 21st century.I think one of the most difficult things was the whole issue around how credit unions operated the number of members in place—and one of the changes we did make was to reduce from seven to two the number of members required. And I think the other major point is about making sure the credit unions can operate and effectively sit alongside banks and in some cases compete with banks. And these are all good aspects and I think one of the underlying structural changes we made was to enable credit unions to become bodies corporate. And of course Mr Smith talked about this in his summary at the beginning of this debate. Basically what that means is that credit unions have the power of a natural person which means it's much easier to be able to operate and pursue what they're going to do.In essence what the bill does is remove unnecessary operating and compliance costs—very important if you're going to compete with banking and offer financial services; promote greater efficiency innovation and accountability; bring credit unions into alignment with other financial institutions; and maintain the element of mutuality which I know we've talked about before. But as we all know mutuality is about having these entities that are focused on providing services for their members and only for the purposes of their members.Dr Duncan Webb: Haven't I heard this speech before?ANDREW BAYLY: So you cannot see third parties coming; it's all about working for their members. And that is the concept of mutuality which I know Mr Duncan Webb understands well.To achieve these aims the measures in the bill simplify the statutory objectives of the association to cover the conduct of activities and provide for the incorporation of credit unions and enable credit unions to also provide financing directly to their members. And one of the issues we all know with credit unions under the current Act is that they cannot lend money to their members' businesses. So in effect we had this convoluted process where it'd have to go to a member and be a trust and then it'd be on lent to the member's business which wasn't really practicable and what this bill does is deal with that and permit that as an operation.So I think this is a great bill. I want to acknowledge Mr Stuart Smith. I also want to acknowledge all the submitters—I think they added to the robustness of that—and also the advisers and I'm looking forward to seeing this pass into legislation.