Money Advice Service helps 1.3m users in first year

Friday 17th August 2012

The Money Advice Service, which is funded by a statutory levy on IFAs, had 1.3 million users in its first year.

Just a tiny handful, 0.2%, were recommended to take regulated financial advice – around 3,000 altogether out of the total.

The Money Advice Service, set up to help people people in financial trouble, itself ran into trouble when it was revealed that its chief executive Tony Hobman was earning £350,000.

He has now resigned and a replacement is being sought.

The MAS reports in its annual review for 2011/12 that only 15% of people can afford to pay for financial advice, but says that it works closely with IFAs and draws on their expertise.

The report reveals that of the 521,000 consumers that took part in a financial health check, 58% were recommended an action plan to resolve their financial issues.

A total of 84,000 people called the MAS and 74,000 took part in face-to-face advice sessions.

Chairman Gerard Lemos described the first year as ‘exceptionally busy’ and said that MAS faced an uphill struggle against poor financial education in the UK.

He said: “In the UK we face a savings gap, a pensions gap and a protection gap. Sometimes people do not have the products they need, and the behaviour of millions of citizens when it comes to money is characterised by passivity and inertia.

“Millions of people are dealing with unmanageable debt, and the levels of financial skills among our young people, as well as many adults, are still too low.

“Our job is to change all that. It’s a big job and won’t be completed quickly.”