Credit union backers finish their work

GREG YOUNGER-LEWIS

The grassroots volunteer movement to create a credit union system in Nunavut has handed their cause over to a territorial coalition of businesses, government and Inuit groups.

Yvonne Earle, spokesperson for the volunteer group, says they are calling it quits, now that they’ve completed a territory-wide survey on support for credit unions.

“We think the results we have would indicate there’s a lot of interest there,” Earle said. “People realize that there has to be a financial institution which serves all the communities of Nunavut.”

Earle said it’s now up to member organizations in the Nunavut Economic Forum to work on establishing a credit union system, because her volunteer group doesn’t have the time and resources to continue. The NEF consists of 40 groups representing Inuit organizations, chambers of commerce, the Nunavut Association of Municipalities, industry associations, labour, and government.

NEF representatives were presented with the survey results earlier this month.

Earle and other volunteers, including Iqaluit Centre MLA Hunter Tootoo, started investigating the credit union idea last summer.

The group said they knew that fundraising would be an obstacle, as previous attempts in the mid-1990s fell at least $1 million short of the $7 million capital investment then required to get a credit union off the ground.

But the group remained focused on credit union principles. Credit unions offer the same services as banks, but are different because of the decision-making power that they give to clients. Credit unions resemble co-ops, where every client is a member and receives dividends in profitable years.

Also, credit union members usually have more influence in policy-making, as they elect their board of directors.

Earle said the recent survey suggests Nunavummiut would support credit unions, because they believe it would be more community-oriented than a bank.

The survey was a compilation of responses from 683 residents in eight communities, or about four per cent of Nunavut’s adult population over 18.

About 80 per cent of all respondents said they would support credit unions.

Earle admitted the survey wasn’t a statistically representative picture of Nunavummiut’s opinions.

But she pointed out that the survey was done on volunteer time, with limited resources, and that another organization could always do a follow-up study.

Alastair Campbell, the acting executive director of the NEF, said they probably won’t pursue the credit union project, as the volunteers hoped.

Campbell said their umbrella organization isn’t meant to be a negotiating group to set up a credit union, or bank.

But he said the NEF could be an advocate for making sure Nunavut eventually does get improved financial services.

“I would see NEF’s role to be ‘keep it on the radar screen,'” Campbell said. “We would try to get our member organizations to keep it moving, not to drop it. This is not the first time it’s come up, and we don’t want to let it go into limbo for another five years.”

Even without the backing of the NEF, the credit union movement could be kept alive by the Arctic co-ops, which lobbied for a credit union system in the past.

Andy Morrison, the CEO of Arctic Co-operatives Ltd., said in a recent interview that ACL was still looking at the credit union option to make up for the lack of financial services in the communities.

But he said they will need to team up with an existing financial institution.

“Credit unions would be the ideal model for Nunavut,” Morrison said. “But it’s frankly impossible to do that in a one-off basis in individual communities.”

Morrison said ACL is reviewing a recent report commissioned by Nunavut Tunngavik Inc., which recommended ACL team up with the Royal Bank to deliver financial services to the communities in the short term.

The most recent incarnation of the credit union movement in Nunavut came together in June 2004, when the Bank of Montreal announced it would close its Iqaluit branch. It was the bank’s only branch in the territory.

Bank officials said they pulled out of Nunavut because they weren’t making enough profit.