The economic secretary to the Treasury has revealed that the replacement for the Money Advice Service - a “slimmed down” money guidance body - will have no marketing spend.
Speaking at an industry forum on the Financial Advice Market Review, Harriett Baldwin said it will identify gaps in the financial guidance market and commission targeted debt advice, money advice and financial capability projects to fill them.
She said the body will have no brand and will not engage in direct delivery instead focusing purely on commissioning services, with the promise of taking “significant input” from the financial services sector.
“Money will no longer be spent on marketing – allowing the new body to channel as much money as possible directly to the front line, via third parties and charities with local expertise,” she said.
“The new money guidance body will have a corporate, rather than a consumer-facing website, where details of funding opportunities will be published. We will ensure that useful budgeting tools and products created by Mas will continue to be hosted on appropriate websites.”
This follows news last month that the Money Advice Service will be scrapped in favour of a new delivery model, merging the functions of The Pensions Advisory Service and post-pension freedom guidance service Pension Wise.
Chancellor George Osborne used his Budget to announce the axing of Mas to make way for a much smaller body to focus on providing “frontline” services to those in financial difficulty.
Ms Baldwin added that government-backed guidance would continue to be offered, stating that many people find pensions a complex subject and are likely to have a range of questions in their lifetime that they will want help and support to answer.
“So we are pooling the expertise of the Pensions Advisory Service and Pension Wise, and some pensions guidance provided by the Money Advice Service into a single pensions guidance body.
“This will make sure that customers can get all their pensions questions answered in one place, and will not face frustrating hand-offs if they have questions about a range of issues.”
Richard Freeman, Old Mutual Wealth’s chief distribution officer, welcomed the government’s indication it will commission firms and charities to provide guidance in future, rather than under its own brands, such as Mas.
“This should create competition among businesses and not-for-profit organisations to come up with effective financial guidance services. This means the success of guidance services can be closely monitored, with successful programmes awarded further funding.”