Asked by: Jonathan Reynolds (Labour (Co-op) - Stalybridge and Hyde)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, how many officials in his Department work on policies relating to mutual societies.
Answered by Andrew Griffith - Minister of State (Department for Science, Innovation and Technology)
The Treasury allocates resources based on the priorities of the department, and officials within the Financial Services Group of HM Treasury provide advice to ministers on issues related to the mutuals sector. Resourcing is kept under regular review to ensure priorities are delivered.
The government recognises the value that mutuals bring to the UK economy. That is why we are taking appropriate steps to ensure that the legislative framework in which mutuals operate under is both a modern and supportive business environment.
As part of the Financial Services and Markets Bill, the Government is amending existing legislation so that credit unions in Great Britain can offer a wider range of products and services. In due course the government will also bring forward legislation to amend the Building Societies Act 1986, which will give building societies further flexibility in raising funds and modernise corporate governance requirements.
In addition, the government is supporting Sir Mark Hendrick’s Private Member’s Bill which would allow co-operatives, mutual insurers, and friendly societies further flexibility in determining for themselves the best strategies for their business, relating to their surplus capital and restrictions on the use of these assets.
Furthermore, the government is in active discussions with the Law Commission on options to proceed with a review of both the Co-operative and Community Benefit Societies Act 2014 and the Friendly Societies Act 1992 with a view to launching the reviews in the next financial year.
Asked by: Rachael Maskell (Labour (Co-op) - York Central)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will make an estimate of the number of registered co-operatives that operated in the UK in each year since 2010.
Answered by Andrew Griffith - Minister of State (Department for Science, Innovation and Technology)
Annual statistics on credit unions in the UK are publicly available from the Bank of England website. Details of registered co-operative societies and the years they are or have been active can be accessed from the Mutuals Public Register.
Additionally, the latest Co-op Economy Report reveals that the number of independent co-operatives in the UK grew by 1.2% in 2020, despite the challenges posed by the Covid-19 pandemic. There are now over 7,000 independent co-operatives, with more than 250,000 employees and nearly 14 million UK co-operative members. These co-operatives contributed £39.7 billion to the UK economy in 2021, up by £1.1 billion from 2020.
Asked by: Rachael Maskell (Labour (Co-op) - York Central)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will make an estimate of the number of credit unions operating in the UK in each year since 2010.
Answered by Andrew Griffith - Minister of State (Department for Science, Innovation and Technology)
Annual statistics on credit unions in the UK are publicly available from the Bank of England website. Details of registered co-operative societies and the years they are or have been active can be accessed from the Mutuals Public Register.
Additionally, the latest Co-op Economy Report reveals that the number of independent co-operatives in the UK grew by 1.2% in 2020, despite the challenges posed by the Covid-19 pandemic. There are now over 7,000 independent co-operatives, with more than 250,000 employees and nearly 14 million UK co-operative members. These co-operatives contributed £39.7 billion to the UK economy in 2021, up by £1.1 billion from 2020.
Asked by: Alison McGovern (Labour - Wirral South)
Question to the Department for Work and Pensions:
To ask the Secretary of State for Work and Pensions, what recent steps his Department has taken to share data with banks for the purpose of fraud (a) prevention and (b) protection.
Answered by Tom Pursglove - Minister of State (Minister for Legal Migration and Delivery)
We have interpreted your question as being about the department’s ambition to access greater data from third parties to help tackle fraud and error.
Under current legislation, Authorised Officers from the DWP are able to obtain information from specified persons and organisations (this includes: banks, credit unions, friendly societies, industrial and provident societies) about their customers to help detect benefit fraud. Authorised Officers may use the powers when it is necessary and proportionate and in accordance with relevant legislation, to prevent, detect and secure evidence of benefit fraud.
The Government will legislate, when parliamentary time allows, for additional powers to require access to data from third parties, in particular banks, to enable the department to more proactively identify potential fraud, such as where claimants might have savings above the capital limit.
Asked by: Catherine West (Labour - Hornsey and Wood Green)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, with reference to the policy statement by the Prudential Regulation Authority entitled CP7/22 – Credit Unions: Changes to the Regulatory Regime, whether he has made a recent assessment of the potential impact of the restrictions to capital investment in credit unions set out in that paper on trends in the levels of growth in the credit union sector.
Answered by Andrew Griffith - Minister of State (Department for Science, Innovation and Technology)
The Prudential Regulation Authority (PRA) is an independent, non-governmental body 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 limited powers in relation to the PRA’s decision-making processes, including any proposed changes as part of their sectoral consultation work.
Regulators are obligated to provide a cost benefit analysis on any proposed changes and an estimate of those costs and benefits if reasonable. This consultation paper includes a cost-benefit analysis; the PRA estimates that any costs are, overall, proportionate to the additional risks involved.
The Government is a strong supporter of the mutuals sector and recognises the unique role credit unions play in their communities, providing savings and affordable loans to their members. As part of the Financial Services and Markets Bill, the Government is bringing forward changes to the Credit Unions Act 1979 to allow credit unions to offer a wider range of products and services. This will allow credit unions to continue to grow sustainably in the future and support them in the vital role they play in financial inclusion.
Asked by: Catherine West (Labour - Hornsey and Wood Green)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, with reference to the Prudential Regulation Authority's consultation paper entitled CP7/22 – Credit Unions: Changes to the Regulatory Regime, published 21 September 2022, what assessment he has made of the potential impact of a 50 per cent cap on interest-bearing deferred shares on (a) the ability of the sector to raise capital and (b) access to finance for financially excluded consumers.
Answered by Andrew Griffith - Minister of State (Department for Science, Innovation and Technology)
The Prudential Regulation Authority (PRA) is an independent, non-governmental body 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 limited powers in relation to the PRA’s decision-making processes, including any proposed changes as part of their sectoral consultation work.
Regulators are obligated to provide a cost benefit analysis on any proposed changes and an estimate of those costs and benefits if reasonable. This consultation paper includes a cost-benefit analysis; the PRA estimates that any costs are, overall, proportionate to the additional risks involved.
The Government is a strong supporter of the mutuals sector and recognises the unique role credit unions play in their communities, providing savings and affordable loans to their members. As part of the Financial Services and Markets Bill, the Government is bringing forward changes to the Credit Unions Act 1979 to allow credit unions to offer a wider range of products and services. This will allow credit unions to continue to grow sustainably in the future and support them in the vital role they play in financial inclusion.
Asked by: Catherine West (Labour - Hornsey and Wood Green)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will hold discussions with the Prudential Regulation Authority on the potential merits of making an assessment of the proposal for a 50 per cent cap on interest-bearing deferred shares.
Answered by Andrew Griffith - Minister of State (Department for Science, Innovation and Technology)
The Prudential Regulation Authority (PRA) is an independent, non-governmental body 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 limited powers in relation to the PRA’s decision-making processes, including any proposed changes as part of their sectoral consultation work.
Regulators are obligated to provide a cost benefit analysis on any proposed changes and an estimate of those costs and benefits if reasonable. This consultation paper includes a cost-benefit analysis; the PRA estimates that any costs are, overall, proportionate to the additional risks involved.
The Government is a strong supporter of the mutuals sector and recognises the unique role credit unions play in their communities, providing savings and affordable loans to their members. As part of the Financial Services and Markets Bill, the Government is bringing forward changes to the Credit Unions Act 1979 to allow credit unions to offer a wider range of products and services. This will allow credit unions to continue to grow sustainably in the future and support them in the vital role they play in financial inclusion.
Asked by: Catherine West (Labour - Hornsey and Wood Green)
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.
Answered by Andrew Griffith - Minister of State (Department for Science, Innovation and Technology)
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.
Asked by: Lord Bishop of Durham (Bishops - Bishops)
Question to the HM Treasury:
To ask His Majesty's Government what assessment they have made of the potential impact of expanding the Help to Save scheme to all Universal Credit claimants and broadening points of access to include credit unions and other providers of low-cost credit.
Answered by Lord Harlech - Lord in Waiting (HM Household) (Whip)
Help to Save aims to support individuals to kickstart a regular, long-term savings habit and build a rainy-day savings fund by providing a generous government bonus on savings over four years.
The scheme’s eligibility criteria target working individuals in low-income households, who may be able to save a small amount each month due to their employment or self-employment income. Individuals are eligible to open a Help to Save account if they are: receiving Working Tax Credit; receiving Child Tax Credit and are entitled to Working Tax Credit; or receiving Universal Credit and had take-home pay of £658.64 or more in their last monthly assessment period.
As the scheme is targeted towards working individuals, the Government has no current plans to broaden the scheme’s eligibility criteria.
Help to Save is currently delivered by NS&I on behalf of HMRC. This delivery model provides national coverage with a single provider, maintaining simplicity for scheme participants and providing a single point of entry to the scheme. The Government has no current plans to alter this delivery mechanism to allow credit unions or other providers of low-cost credit to offer Help to Save.
Asked by: Gregory Campbell (Democratic Unionist Party - East Londonderry)
Question to the Northern Ireland Office:
To ask the Secretary of State for Northern Ireland, if he will have discussions with the Chancellor of the Exchequer on the roll-out of a pilot No Interest Loan Scheme in Northern Ireland.
Answered by Steve Baker - Minister of State (Northern Ireland Office)
The Government has provided £3.8 million of funding to Fair4All Finance to pilot the No Interest Loan Scheme, which will help consumers in vulnerable circumstances to access affordable credit. These loans will be administered by Credit Unions, Community Development Finance Institutions and other lending organisations. HM Treasury are working with Fair4All Finance to facilitate the launch of the pilot in Northern Ireland and my officials will support HM Treasury in exploring the prospect of a quicker rollout in Northern Ireland.