Credit union trade groups applauded the NCUA’s plans to cut its budget and workforce by more than 20% next year at an agency hearing Wednesday.
NCUA’s draft budget for the fiscal year beginning Jan. 1 is $313.8 million, a 20.6% drop from 2025. By 2027, spending would rise modestly to $344.7 million but remain 12.8% below 2025 levels.
The cuts will result in a like 23% drop in the fees credit unions pay the NCUA next year.
Curt Long, chief economist for America’s Credit Unions, said the proposed budget “reflects a meaningful overall reduction in spending compared with the prior two-year plan, signaling the agency’s commitment to careful resource management and responsiveness to stakeholder concerns.”
NCUA plans to cut 288 jobs next year, or 23% of its 2025 workforce of 1,255.
“A total staffing level of 967 positions and a pay and benefits budget of $239.6 million appear far more cost-effective as the number of credit unions declines,” Long said. “The NCUA should avoid understaffing and ensure consistency in examiner experience and staff points of contact.”
At the start of the hearing in Washington, D.C., NCUA Chair Hauptman said the budget cuts might be unusual for a government agency, but they would be typical in the private sector.
“We have a smaller workforce, but the staff we have is what efficient government looks like,” Hauptman said.
The Defense Credit Union Council emphasized that the size of the NCUA’s supervisory budget should shrink based on the decline in the number of credit unions it supervises, not mentioning the rising overall assets and complexity of the remaining credit unions.
Jason Stverak, DCUC’s chief advocacy officer, said the NCUA should perform exams less frequently for less risky credit unions, and perform more of them remotely.
However, he said NCUA needs to be more careful in its cuts to the Office of External Affairs and Communications. The draft budget calls for an 82% cut, reducing its staff from 16 people to three.
“Given the agency’s ongoing transformation, this is the wrong time to diminish a function that ensures open communication with industry stakeholders, Congress, and other regulators,”
Hauptman noted that many of the people, including those who handle social media, were being moved to different divisions, rather than having their jobs eliminated.
“All of this — and this is rare for government — we're focusing on is the have-to-haves, not the nice-to-haves,” Hauptman said.
The staff draft budget was released in September, and the deadline for written comments has been extended until Friday.
Contact Jim DuPlessis at JDuPlessis@cutimes.com.
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