WASHINGTON–The release of NCUA’s proposed 2021/22 draft budget, which is smaller than its current budget, is being welcomed by both credit union trade groups.
CUNA Vice President of Research and Policy Analysis Mike Schenk said he and others have just started to review the 110-page document that was released late last week but he is pleased with what he has seen so far.
“I have been generally impressed with the level of detail provided and expense justifications provided over the last few years,” said Schenk. “CUNA has been supportive for several reasons. First, overall expenditures seem reasonable and in general the agency seems focused on controlling costs. The discretionary spending seems aligned with the priorities we at CUNA have supported, such as remote exams. NCUA has said (remote exams) could lead to lower costs in the future, and that is something we have really embraced. We see some of that coming to fruition.”
Schenk noted the pandemic has accelerated NCUA’s adoption of remote processes and as a result significantly lowered costs.”
5% Lower Spending
Schenk said the proposed NCUA budget of $342 million for 2021 is almost 5% lower than the spending level approved earlier by the board and is 1.5% less than comparable spending for 2020.
Nearly all of the savings NCUA is seeing, said Schenk, are the result of reduced travel expenses for examiners as a result of remote and offsite exams.
“The third big thing is the reduction in the capital budget, which is largely driven by completion of latest phase of the MERIT budget,” said Schenk.
Similarly, NAFCU’s Carrie Hunt said the trade group’s initial response to the NCUA budget is “positive.”
Both Hunt and Schenk said their respective organizations would be providing comment prior to the Dec. 11 comment deadline.
NCUA will also host a public briefing on the budget on Dec. 2.