§ Ms WalleyTo ask the Chancellor of the Exchequer, what his Department has done to support(a) credit unions and (b) friendly societies since 1997. [79394]
§ Ruth KellyThe Government welcome the contribution of the mutual sector, including credit unions and friendly societies, to increasing choice and widening access in financial services.
Following the Financial Services and Markets Act 2000, the Financial Services Authority has assumed responsibility for the regulation of credit unions and friendly societies. The Act also introduced an independent ombudsman scheme and single financial services compensation scheme. These measures should increase confidence in those considering membership of either credit unions or friendly societies.
We are in the process of delivering a programme of deregulatory measures with the aim of increasing the operational flexibility of credit unions. For example, four measures were introduced in July this year, including enhancement to credit unions' ability to borrow from external sources and more flexibility in the way credit unions can pay dividends to members.
Measures such as the introduction of the Saving Gateway and the Child Trust Fund are intended to encourage saving by low-income groups, which should benefit credit unions and friendly societies.