Co-operative and Community Benefit Societies and Credit Unions Bill [HL]

My Lords, these Benches are also keen to support the general thrust of the Bill, Anything that can draw people together in what in our day-to-day prayers we call the building up of our common life with the trust and support of one for another is to be welcomed. It is the foundation of common life in this country that we have a mutuality of concern for one another, and unless that has some secure basis in the way that we legislate to live our life together, we will see increasing fragmentation. In the diocese of Salisbury some seven credit unions have been set up in the past 10 years, all of which are working well, while one of my priests in Poole has been chairman of the national organisation of credit unions and is himself working to set up a credit union for the sake of the clergy, to assist them in facing those peaks of expenditure when their income is rather inclined to remain on a plateau. I welcome these initiatives and the detail of the legislative framework that lies behind them. I want to speak about the importance of these credit unions and their social benefits. The positive benefits that credit union membership brings to communities are huge—especially to those on low incomes, of course, but also to everyone else who participates in them. I participate in a credit union, partly because I think it is important for people not just to use these institutions when it might be convenient to them. We all know that their origins are in the social management and help of one for another in the working years of the industrial revolution in the 19th century, but we all need to support these kinds of ventures because otherwise people will imagine that we are interested only in those banking organisations that exist primarily to make money for those who have shares in them. The reason why in many cases people do not get much out of a high street bank, as the noble Lord just now referred to, is just that: a high street bank will calculate what profit is in it for itself, rather than who needs cash now not to fall into serious debt or become the victims of a loan shark or worse. The noble Lord referred, too, to the heavy mobs going in. I have seen the results of that in estates on the edge of Poole. Noble Lords may think that I have a leafy diocese but one-quarter of its population lives in Poole, a substantial area with its own estate cultures and one or two rather dangerous no-go areas. It has been just as he says in recent months and years, primarily as a result of the unavailability of credit of any kind when something happens that to you or me might be of very little significance, like a washing machine exploding. But, in that kind of context, the replacement for people on very low incomes and living in very small housing units, something in which they can wash their children’s clothes is of considerable importance and they have very little option. In normal ways, the banks would not lend them those kinds of sums because they would be considered to be a risk. I watch families fall into debt and for the first time, certainly since I have been in Salisbury, we have churches running substantial breakfast groups for children who are sent to school without anything to eat in the morning. The reality is that there is a big gulf between those who have access to credit and those who do not. We need to support this timely Bill. With the mainstream banking sector in some disrepute, customers need a reliable and honest home for their money. Co-ops, mutuals and credit unions are already a significant part of the economy, with total assets of more than £400 billion and a combined membership, according to my information, of more than 30 million people. But that is not enough. We need to make this the mainstream of the way in which people bank and support each other. Because it works so well at the very local level this is really important. Often, those who have shares in the major high street banks seem to be at such a remove from those who need money immediately. Seeing how the people next door are affected binds communities together. We talk a lot about the social glue that we need and here is a prime example of a way in which we can move to make it happen. I echo the call of my noble friend the most reverend Primate the Archbishop of Canterbury who last year called for the encouragement of locally based, entirely trustworthy, user-friendly, educationally sensitive and confidence-building methods of managing debt, such as those represented by the credit unions. I very much hope that this Bill will bring increased flexibility to the way in which these organisations can operate and will enable credit unions to work with corporate members, small family businesses, religious groups active in community work, local co-operative networks and so on, and will give the option to members of paying interest on continuing savings retained in the credit union, rather than receiving a dividend. That would be a very important sign to those who think that banking is primarily about what you can get out of it for yourself. With this Bill being supported in all parts of the House—we will do our best to make sure that it gets through its stages on to the statute book, easily, completely and swiftly—we have a way in which to show people that our primary interest is to build local support and to get it right. I not only congratulate the noble Lord on bringing this Bill before the House again, but am pleased to note that the Government wish to support it. I look forward to what the Minister will say about how soon we can hope to see it on the statute book.