October 2, 2003

OTTAWA, October 2, 2003 - In its submission to the House of Commons Standing Committee on Finance pre-budget consultations, Credit Union Central of Canada (Canadian Central) recommended the government take action in four specific areas when it unveils its next Federal Budget. Canadian Central's submission focused on debt reduction, Farm Credit Canada, BSE (mad cow disease), and Competition Bureau fees.

Jack Smit, Chairperson of Credit Union Central of Canada, commended Committee members for “playing such a critical role in ensuring that all Canadians have input into the government’s budget planning process.” In his remarks, Mr. Smit urged the Committee “to exercise some caution when contemplating cutting taxes further or increasing program spending”, in light of the challenges the government’s budget will face with the economic slow down.

Canadian Central’s submission went on to encourage the government to look at the role that Farm Credit Canada plays in rural communities across the country and to ensure that the government consider ways in which crown agencies such as the FCC can more effectively partner with credit unions.

Mr. Smit further commented on how the BSE issue has affected credit union members in the cattle industry across the country. He said “credit unions are major lenders to the cattle industry and we are seeing first-hand the impact of the border closures on our members”. In this regard, Canadian Central recommended to the committee that the government commit to continue equitable funding to the BSE recovery program until the border is open to all classes and sizes of cattle.

The submission concluded by recommending that Canada’s Competition Bureau adopt more equitable fees based on asset and transaction sizes for merger reviews conducted by the Bureau. Mr. Smit stated that the current “flat fee framework actually discourages mergers in the credit union system”, because it acts as a disincentive for larger credit unions seeking to merge with smaller credit unions.

A copy of Canadian Central’s submission to the House of Commons Finance Committee can accessed at our website: www.cucentral.ca. (click on press releases)

With $69 billion in assets, more than 600 credit unions and 4.6 million members, Canada’s credit union system is a vital competitor in the financial services industry. Credit Union Central of Canada (“Canadian Central”) is a federally-regulated financial institution that operates as a national trade association and finance facility for its owners, the provincial credit union centrals and, through them, for more than 600 affiliated credit unions across Canada. . The credit union system is a three-tier structure of local, provincial and national organizations. Local credit unions operate autonomously and are the primary shareholder members of provincial Centrals, which are in turn the primary shareholder members of Canadian Central. For more information about Canada’s credit unions, check out www.cucentral.ca.