§ 8.45 p.m.
§ The Minister of State, Department of Social Security (Lord Mackay of Ardbrecknish) rose to move, That the draft order laid before the House on 12th February be approved [13th Report from the Delegated Powers Scrutiny Committee].
§ The noble Lord said: My Lords, I beg to move. I shall speak also to the Deregulation (Credit Unions) Order 1996. I am pleased to commend both orders to your Lordships tonight.
§ As your Lordships might recall, the Deregulation (Building Societies) Order 1995 was debated in this House last November. The draft orders presently before the House continue the theme of promoting economic growth, widening competition and enhancing the future of mutual institutions by removing rules and regulations which place unnecessary burdens on them.
§ Under the Deregulation (Friendly Societies Act 1992) Order, friendly societies will benefit, in particular, from more flexible regulatory and accounting requirements. Other changes include extending the activities of branches of incorporated societies; removing the need for societies to draw up a statement of life assurance business every five years if they carry out an annual valuation; and making it easier and quicker for societies to apply for confirmation of amalgamation, transfer or conversion.
§ The Deregulation (Credit Unions) Order will provide a new opportunity for growth in the movement by extending the possible scope of their activities and introducing a new qualification for membership. The maximum shareholding is also increased. It will allow those credit unions which can demonstrate satisfactory management and systems greater flexibility in the use of their funds by increasing the limits on loans to members and the maximum allowable repayment periods.
§ The credit unions themselves have asked for the changes that this order will give them. They find that they are operating under far too many restrictions at the moment and this order goes a long way to freeing them from bureaucracy while keeping in place the necessary protection for members. I commend the order to the House.
§ Moved, That the draft order laid before the House on 12th February be approved [13th Report from the Delegated Powers Scrutiny Committee].—(Lord Mackay of Ardbrecknish.)
§ Viscount Chandos
My Lords, I thank the Minister for his clear and succinct summary of the two orders. We 1565 debated the deregulation of building societies a few months ago and I was able to say that we on this side of the House very much wish to encourage the widest possible range of legal structures for businesses and other enterprises, subject to best management and governance practice.
We therefore welcome the measures contained in both orders. They will enable friendly societies and credit unions to widen and improve their services to their policy holders and other customers and to strengthen their competitive position vis-à-vis limited companies while still maintaining the paramount protection of consumer interests. I believe that the proposals have those objectives and I commend them to your Lordships' House.
On Question, Motion agreed to.