Question to the HM Treasury:

To ask the Chancellor of the Exchequer, whether his Department has made an assessment of the potential challenges faced by financial mutuals seeking to raise external capital while retaining their mutual status.

Financial mutuals, such as building societies and credit unions, have a strong focus on serving local communities for the benefit of their members. This leaves them well placed to make an important contribution to the Government’s priority to drive good growth in every postcode of the UK.

The Government is undertaking a multi-year programme of work to support financial mutuals. This includes, for example, updating the Building Societies Act 1986 to reduce unnecessary administrative burdens and provide greater funding flexibility, reforming the credit union common bond through the Financial Services and Markets Bill, and asking the Prudential Regulation Authority and the Financial Conduct Authority to produce their joint Mutuals Landscape Report, which identified opportunities for growth-focused reform.

Access to capital is a longstanding structural issue for mutual businesses, and one in which the Government takes a close interest. The Mutual and Co-operative Sector Business Council is currently considering this, including the barriers faced by the sector and potential solutions. The Government will review the Council’s work as it develops and consider the proposals it brings forward.