WASHINGTON–While trade groups and credit unions alike are hailing NCUA for its much-thinner proposed budget in 2026—and the reduced operating fee for CUs as a result—could the agency get too thin in some areas?
While it believes it’s an issue to be monitored, America’s Credit Unions believes the budget cuts—which have involved the exit of 20% of NCUA’s staff as part of White House-ordered reductions—are manageable.
“Obviously, for years we’ve been saying that the agency budget has been too high and I think if you look at some of the areas where there were cuts, and I’m thinking especially about the administrative parts of the agency which we really highlighted last year, they really took it back down to kind of the prevailing trend prior to the big rise (in spending) that we’ve seen in recent years,” said Curt Long, chief economist with America’s Credit Unions. “So, I don’t think at a high level that this is an unworkable budget. I think it again provides the opportunities for a more efficient agency going forward, and there will need to be some exercised in that process.”
The Recommendations
As the CU Daily reported here, America’s Credit Unions has submitted its letter to NCUA offering comment and suggestions ahead of the agency’s public budget hearing, which is scheduled for Nov. 5.
The letter includes seven recommendations:
- NCUA should use the voluntary separation program and federal hiring freeze to assess what resources it truly needs and build a leaner, more adaptable workforce
- Examination time and travel should focus on the highest-risk and most complex credit unions, while low-risk, well-run credit unions can be supervised more remotely using data and analytics
- The agency should also take a closer look at how its specialized oversight functions are organized and modernize its approach to consumer protection oversight
- Each part of the budget should include clear measures that show how effectively the money is being used and its impact
- NCUA should accelerate development of its enterprise data platform and expand use of analytics to support off-site supervision and predictive risk modeling
- A portion of the NCUA’s budget should be devoted to innovation-related activities, such as pilot programs, interagency partnerships, and technical assistance grants
- NCUA should provide a clear description of the anticipated changes to its organizational structure, including how they are expected to improve efficiency and reduce costs.
