The National Credit Union Administration accepted final budgets for 2023-2024 after making significant cuts in overall funding and the number of new hires.
At the NCUA's monthly board meeting on Thursday, officials unanimously approved
For 2023-2024, the NCUA incorporated a $1 million decrease in travel funding, eliminated seven proposed positions and cut roughly $23.2 million in surplus carried over from 2022, said Jim Holm, supervisory budget analyst at the agency.
The changes came in response to
"Compared to the overall funding and staffing levels shown in the staff draft budget, this budget is now smaller in terms of dollars and staff," NCUA Chairman Todd Harper said during the meeting.
"However, it is still a step in the direction of achieving the NCUA's mission of protecting credit union members and consumers, maintaining the safety and soundness of credit unions and safeguarding the credit union system and the National Credit Union Share Insurance Fund."
The budget increase is 1.9 percentage points lower than the 8.1% budget growth originally estimated in the October staff draft, and 6.1 percentage points lower than the 12.3% budget increase approved for 2023 as part of last year's budget, Holm said.
Despite the agency's concessions and the fact that inflation has soared this year, the National Association of Federally-Insured Credit Unions and the Virginia Credit Union League expressed concern about the size of the increase in the NCUA's operating budget, which represents part of the agency's total budget.
Dan Berger, NAFCU's president and chief executive, chastised the agency for the 7.5% increase in its 2023 operating budget. He also called for continual review throughout the year to support a re-evaluation and possible lessening of the currently estimated 12% hike in the same budget for 2024.
"While NAFCU supports an engaged and supportive NCUA, we do not support undefined cybersecurity expenses, nor do we support examiner staffing increases without adequate justification," Berger said.
He also called for greater budget oversight to prevent cost overruns, pointing to what he called the agency's "uncontrolled management" of funding for its
Meanwhile, the NCUA highlighted the potential for additional costs not accounted for in its final budget, which could stem from needed modifications of data fields in quarterly call reports and other transparency requirements. Such changes might result from the passage of the Financial Transparency Act as a component of the larger
"From the standpoint of credit unions, our expectations of the NCUA and its budget boil down to this," said Carrie Hunt, president and CEO of the Virginia Credit Union League. "Be good stewards of the funds provided by credit unions; ensure budget priorities truly align with the agency's mission; prioritize personnel and programs that directly impact credit unions' ability to compete, serve members, and remain safe and sound; and lastly protect the industry by safeguarding the Share Insurance Fund."
