Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what steps her Department has taken with (a) building societies, (b) friendly societies and (c) mutual insurers to grow the size of the mutual sector.

The government is committed to supporting the growth of financial mutuals in line with the manifesto commitment to double the size of the mutual and co-operative sector. HM Treasury has already announced measures to support financial mutuals and is currently progressing these.

For building societies, HM Treasury has committed to progressing further amendments to the Building Societies Act 1986 following two statutory instruments being laid in October 2024. This will create a more supportive legislative environment for building societies.

For friendly societies and mutual insurers, HM Treasury is funding the Law Commission’s independent review of Friendly Societies Acts 1974 and 1992, which will put forward recommendations to develop a more modern and supportive legislative environment for relevant societies. The government will carefully consider the findings of the review to understand whether legislative reform is needed.

To support all financial mutuals, HM Treasury has also asked the Prudential Regulation Authority and Financial Conduct Authority to produce a report on the current landscape of the sector. This is expected to be published before the end of 2025. The government also welcomed the establishment of the Mutual and Co-operative Sector Business Council to provide a voice for the mutuals sector to support government policy. Representatives from major building societies, mutual insurers, and relevant trade bodies sit on the Council. The government also published the Financial Services Growth and Competitiveness Strategy, which will support all organisations in the financial services sector and encourages the sector to continue to work in partnership with government to deliver growth.

The government welcomes its regular engagement with financial mutuals, including through the Council, to understand how best to support growth. This includes ministerial meetings and roundtables. For example, representatives from building societies, mutual insurers, and credit unions recently contributed their views at roundtables on the Growth & Competitiveness Strategy. Additionally, from November 2024 to March 2025 HM Treasury ran a call for evidence to collect formal responses on potential reform of the credit union common bond in Great Britain. Responses to this are now being considered and next steps will be communicated in due course.