Question to the HM Treasury:

To ask the Chancellor of the Exchequer, with reference to the Prudential Regulation Authority’s Consultation Paper, CP7/22, entitled Credit Unions: Changes to the Regulatory Regime, published in September 2022, what assessment he has made of the implications for his policies of those amendments and their impact on credit unions financial services; and whether his Department has had discussions with the Prudential Regulation Authority on the reason for not producing a cost-benefit analysis of the proposed changes.

Both the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA) are independent, non-governmental bodies responsible for regulating and supervising the financial services industry, including credit unions.

Although the Treasury sets the legal framework for the regulation of credit unions, it has strictly limited powers in relation to the PRA and the FCA’s decision making processes, including any proposed changes as part of their sectoral consultation work.

As part of this legal framework, the regulators are obligated to provide a cost benefit analysis and an estimate of those costs and benefits if reasonable.