Financial Services Bill

New clause 10 would extend FSA regulation to credit unions in Northern Ireland. The Bill is a convenient and appropriate legislative vehicle to fulfil a growing demand being made on behalf of the credit unions in Northern Ireland and their many members. That demand has been proposed by the Irish League of Credit Unions, the Ulster Federation of Credit Unions and others. This matter has also been the subject of an extensive inquiry by the Committee for Enterprise, Trade and Investment in the Northern Ireland Assembly, which I chaired at the time of the inquiry. The Committee's report, which was unanimously adopted by the Assembly, called for the extension of FSA regulation to credit unions in Northern Ireland. I want to stress that that demand exists not because people have detected problems with the way in which our credit unions are treating their customers, or because there are concerns about their soundness; rather, it is because of the recognition that, although they are strong in terms of their numbers and their savings base, the range of services that they can offer is highly limited compared with their counterparts in Great Britain. Credit unions in Northern Ireland can offer their members only three services: share accounts, loans and life assurance. Credit unions in Great Britain can offer not only those services but current accounts, internet and phone banking, standing orders for payments such as wages, mortgages, debit cards, direct debits, bill payments, junior savings accounts and child trust funds, as well as home, travel, health and car insurance. All those services are available from credit unions in Great Britain, but not from those in Northern Ireland, even though they are much bigger and stronger. Credit unions in Northern Ireland have about 400,000 members. The Consumer Council for Northern Ireland estimates that 26 per cent. of the population there belong to a credit union, of which there are 170 in Northern Ireland. In November, the Assembly heard that there were £775 million-worth of savings in the credit unions, and that the loans from credit unions to members totalled £516 million. The credit unions therefore play a significant role in our community. To enable them to play a bigger and better role in the lives of their members, and to make a much bigger contribution to financial inclusion in Northern Ireland, however, they need to be able to offer a wider range of services. The passport to that is FSA regulation. That is essentially what was established in the inquiry undertaken by the Committee for Enterprise, Trade and Investment. I want to assure the House that that inquiry was extensive. It did not happen quickly; it took evidence on a number of different tiers and it established a strong consensus. That consensus was adopted not only by the Assembly but by the Northern Ireland Executive and by the relevant Department—the Department of Enterprise, Trade and Investment.