The Government has been urged to appoint the Director of Consumer Affairs to the governing board of the Irish Financial Services Regulatory Authority (IFSRA), the new regulatory division of the Central Bank, to quell scepticism over its competence to protect consumer interests.
Questioning the Central Bank's ability or willingness to sympathetically plead the case of the public, opposition politicians and consumer lobbyists called on the Minister for Finance, Mr McCreevy, to second the director, Ms Carmel Foley, to the interim board of the IFSRA.
They warned that the consumer representative last week nominated to the IFSRA board may be "under the thumb" of the Central Bank and ill-placed to safeguard customers of banks and other financial institutions. Mr Richard Bruton, Fine Gael finance spokesman, said Ms Foley should be appointed to the authority to ensure consumer interests received - and were seen to receive - a fair hearing.
Ms Joan Burton, Labour finance spokeswoman, said the interim board was stacked with industry figures who appeared to have little understanding of, or affinity with, consumers.
The Consumers' Association cautioned that the director might not be the most suitable authority as she was a servant of the State but added that a non-Government organisation merited a place on the IFSRA board.
"It is important the regulator is perceived to be fighting for consumer rights rather than cosying up to the banks," said association chief executive Mr Dermott Jewell.
"An independent individual should be placed on the board to safeguard public interests. People will become cynical if appointees are drawn exclusively from the financial services sector."
Mr McCreevy rejected the pleas, saying he was satisfied that the IFSRA's "in-house" consumer director would offer adequate protection to the public.
He dismissed Ms Burton's claim that board appointees were not qualified to act on consumers' behalf.
It was inevitable that nominees to a body such as the IFSRA would have a track record in financial services and related fields.
Differences over the make-up of the board emerged as the Bill setting out the IFSRA's powers and functions was considered by the Dáil select committee on finance and the public service.
The interim board, headed by Central Bank governor Mr John Hurley, has been unveiled ahead of the IFSRA's establishment in law.
The powers and functions of the Director of Consumer Affairs related to banking and financial services will transfer to the IFSRA when it is formally constituted later this year.
Ms Mary O'Dea, a former head of regulatory enforcement at the Central Bank, was last week named as the IFSRA consumer director from a shortlist of seven.
Controversy has dogged the IFSRA since its inception. Concern has already been voiced over the Government's decision to make credit unions answerable to the regulator.
Mr McCreevy has agreed to a compromise under which the authority will be obliged to take account of credit unions' non-profit and voluntary status.
