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Written Statement - Financial regulatory changes that exempt developers wishing to participate in the Help to Buy – Wales scheme from obtaining a Consumer Credit Licence

Carl Sargeant, Minister for Housing and Regeneration

Financial regulatory changes that exempt developers wishing to participate in the Help to Buy – Wales scheme from obtaining a Consumer Credit Licence

As Minister for Housing and Regeneration, my overarching priority is to increase the supply of houses in Wales.  As part of this work, I launched the Help to Buy – Wales scheme in January of this year: a £170 million shared equity loan scheme designed to support home ownership, stimulate building activity and provide a welcome boost to the housing sector.

The scheme has already made an important contribution to restoring confidence in the Welsh construction sector, something that has been reflected in the most recent housing statistics that show an increase in the number of new sites under development across Wales.  However, in light of this progress, I have also been looking at ways to extend the benefits of the initiative to a wider selection of both developers and buyers by addressing any barriers to participation.

Based upon responses from Assembly Members, constituents and the building industry more generally, it is clear that the legal requirement for builders to obtain a consumer credit licence before registering with the Help to Buy – Wales scheme has acted as a significant deterrent given the costs involved in obtaining this licence from the Financial Conduct Authority.  

Whilst financial regulation is a non-devolved issue, I have been pressing the UK Government to amend the legislation in this area.  I am very pleased that the UK Government has taken the decision to table the following Statutory Instrument: The Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) (No. 3) Order 2014.  Full details of which can be found at:

http://www.legislation.gov.uk/uksi/2014/1740/contents/made

This legislation has the effect that, as of today (28 July 2014), all builders wishing to participate in the Help to Buy – Wales scheme are no longer required to hold a consumer credit licence in order to participate in the scheme.  As a result, I have amended the registration process for developers to reflect this, as outlined on the Help to Buy – Wales website:

http://helptobuywales.co.uk/builder-registration/how-to-register

“This statement is being issued during recess in order to keep members informed. Should members wish me to make a further statement or to answer questions on this when the Assembly returns I would be happy to do so.”