Single body to advise public on pensions and debt

A new financial guidance service to provide advice on pensions, managing debts and other money issues is to be created by the government.

It will replace the heavily criticised Money Advice Service (MAS) as well as two pension advice services.

The government thinks a single advisory body will be more efficient but has yet to decide how the new service will actually work.

The abolition of the MAS was announced in the Budget in March.

It was criticised for failing to help those who needed it most and paying its staff too much.

No timetable

Like the MAS, the new organisation will be paid for by a levy on financial services companies.

The new body will also take on the roles of the Pensions Advisory Service, and Pension Wise - an organisation set up in response to pension reforms introduced in 2015.

The government looked at setting up two bodies to replace the MAS and pensions services. But industry and consumer finance groups raised concerns over how they would work together effectively.

The new body as yet has no name and there is no timetable for its creation.

Value for money?

Pensions minister Richard Harrington said: "A single guidance body will be more efficient and will help consumers make the right financial decisions. We are committed to ensuring people can access the best free and impartial financial guidance possible."

The MAS was set up to help people who face problem debt to find the help they need, to help consumers understand financial services and to make better decisions. Various money-management tools are available on its website.

It came under fire for duplicating work already provided in the private and charitable sectors and for failing to reach those who needed its help the most.

Inquiries by the Commons Treasury Select Committee and National Audit Office raised questions about the value for money and effectiveness of its consumer finance education role.

It was set up in 2010 in response to a review which estimated 19 million people in the UK would benefit from generic financial help.

Pension Wise was established alongside retirement freedoms introduced in 2015. It aims to help people approaching retirement decide what to do with their money.

The Pensions Advisory Service also offers free and impartial pensions guidance.