Treasury Select Committee chairman Andrew Tyrie has hit out at the government after the chancellor confirmed the ongoing review into the Money Advice Service, due to report before the end of the year, would not consider its future.
In a series of letters over the summer, published online yesterday (30 November), George Osborne confirms the scope of the review does not include fundamental questions over Mas’s future as the parliamentary timetable is too tight and the Treasury is busy implementing the guidance guarantee.
Ironically, questions were raised as to whether the Mas should be retained in its current form in part after it was snubbed for the guidance service. The Treasury Committee has also previously uncovered several serious problems at the service.
The news will likely spark anger among advisers, who have long campaigned for changes at a body which is to cost £81m in the current financial year, paid for through industry levies, and which has been criticised in the past over its stance towards advice and a lack of signposting.
Earlier this year chairman Andrew Tyrie expressed concern about the service’s role in the implementation of the guidance guarantee, which appeared to have been taken on board when the body’s part to play was scaled back in revised plans.
While Mas will not be involved in direct consumer contact, staff will be involved in the online part of the service and developing guidance material to be provided to customers, as well as building a directory of regulated advisers for those wishing to go further than the guidance.
According to a series of letters exchanged between Mr Tyrie and chancellor George Osborne, the Treasury Committee is still “very concerned” about the future of the Mas as a statutory body,
In a letter, Mr Tyrie wrote: “The Treasury Committee remains very concerned that the crucial question of the Mas’s future as a statutory body has been excluded from the reviewer’s terms of reference.
“In other words, the future of Mas has been taken off the independent reviewer’s agenda.”
He continued that the committee’s inquiry uncovered several serious problems at the service, despite efforts having been made to reform it.
“The jury remains out on whether the Mas should be retained in its current form. It is essential, as the committee recommended, that the future of the Mas be included in the remit of the independent reviewer’s work.
“The Committee will, in any case, want to scrutinise the reviewer’s report in detail when it is published later this year,” added Mr Tyrie.
In May, the economic secretary to the Treasury Andrea Leadsom confirmed that Christine Farnish would lead the review.
The chancellor had responded to concerns by stating that “given the already tight timescale for the review and the nature of the last session of parliament, it is highly unlikely that we would have sufficient time to make any statutory changes that the review may recommend”.
peter.walker@ft.com
