4. What is the Welsh Government doing to support credit unions? OAQ52204

Well, £844,000 is in place over the next two years for credit unions to take forward projects to support financial inclusion. An additional £1 million has also been agreed to support credit unions with their growth. 

Diolch. The Minister for Housing and Regeneration has rightly commented that credit unions in Wales deliver financial awareness education for adults and children, they support people dealing with debt problems and provide some of the most vulnerable people with sound and ethical financial products, and therefore I very much welcome that the Welsh Government recently announced that credit unions across Wales will receive additional funding, including the £844,000 of funding, for projects that support people who are struggling financially. Sadly, under this UK Government, these people are the many and not the few. What direct impact does the First Minister then think this financial and capacity support for credit unions will give to some of the most vulnerable people in Islwyn?

I can say that officials will be meeting with the credit union sector on 21 May to discuss the financial transactions capital support that's being made available for this and the next financial year. Indeed, there's been interest from credit unions in terms of accessing that. We now have some 75,000 credit union members in Wales, and for many credit union members the credit unions provide a choice that doesn't involve going to loan sharks. We know that, and we know the financial pressures that have come on people over the last eight years, and we've seen never-ending austerity, and that's why the credit unions play such an important role in our communities, and it's why we have been supporting them to support people.

First Minister, I was looking forward there to saying I agree with Rhianon Passmore. Unfortunately, the bit at the end I found difficult to agree with, but the first part was positive. Can I also concur with those sentiments that credit unions do a great deal of work across Wales? In south-east Wales, my area, the Gateway Credit Union has branches in Abergavenny and in Bulwark, and as Rhianon Passmore said, they do a great deal to deal with poverty issues. Would you agree with me that it's important that we recognise the role that credit unions play in rural areas as well? It's not just an urban area that they serve. There are great pockets of rural poverty across my area, and also mid Wales as well, and they have an important role to play there. So, when you're targeting this funding, will you make sure that rural areas' poverty is addressed as well?

Absolutely. Credit unions are as relevant to rural areas as they are to urban areas. Some years ago, when I first went to Ireland, it was noticeable how large the credit unions were, particularly in small country towns, and the progress that had been made there. So, credit unions have a relevance and they provide a means of support to all communities in Wales, urban or rural.

Although people from Wales are members of credit unions, as compared to the rest of the UK and Ireland, as you’ve just said, membership is much lower than it is in those other nations. So, when I raised these issues with you in the past, I suggested the concept of having a national hub for credit unions. Yes, funding is provided to them individually, but there’s a great deal that they can learn from each other so that they can work and improve their offer as credit unions. So, where are you with looking into that concept and what are you as Government doing in terms of promoting or encouraging members of the civil service staff, for example, to save with credit unions, in order to ensure that we as Members, and those working here in Wales, play our role in promoting this sector?

I mentioned the funding that’s available and I mentioned the meeting that will take place next week. Membership of credit unions has increased from 10,000 people at the beginning of the century to 75,000, as I said, currently. So, there has been a great growth. The next step for credit unions, I think, is for them to consider how much they want to grow and what capacity is needed for them to grow. I know that, in Ireland, they can have hundreds of thousands of euros-worth of loans, which is much greater than those available in Wales. So, we must consider how far some of these credit unions wish to go. Do they want to grow to become much bigger, like the Irish credit unions, or do they want to remain as local credit unions? I think some of them will choose the first route and some will choose the other, but we will continue to speak with them in order to identify the ways in which we can ultimately promote them.