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Categories:Advisers,Regulation

Money Advice Service moves to "advice-type" activity

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The Money Advice Service says it is moving towards offering an “advice-type” service, rather than information and guidance only, but insists it will not enter the regulated advice space.

Speaking at the Marketforce conference on the future of distribution in financial services in London today, MAS policy lead Francis McGee said people are more aware of the need for financial advice in tough economic times, but it is difficult to convert that awareness into action.

McGee said: “Advice of all kinds can help with that. Advice is more directional, more assertive, more personal, than simply and solely information and education-type activity. Which is why at MAS we are moving very clearly from just doing information and education towards doing advice-type activity.”

Aviva RDR programme manager Ross Anderson questioned McGee on whether this signals that MAS is moving into regulated financial advice?

McGee said: “No”

Earlier this month, the MAS refused to answer questions about how much it is spending on redundancy packages, directors’ remuneration and overseas trips for senior management.

Money Marketing put a number of questions to chief executive Tony Hobman but the service refused to provide detailed answers.

Earlier this month, Money Marketing revealed that three-quarters of the MAS team of 150 have been put on consultation.

The majority of MAS staff moved across from the FSA’s Consumer Financial Education Body when it became the MAS in April.

An MAS spokeswoman has confirmed that all staff who moved across from the FSA are entitled to “a comprehensive redundancy” package, as set out in the FSA’s employee handbook. The handbook states the maximum payment allowed is the greater of one year’s salary or £100,000.

The MAS is funded by a statutory industry levy. It has a budget of £43.7m for 2011/12, which includes £13.5m for staff costs.

Last week, Money Marketing revealed that MAS spent more than £250,000 rebranding the Money Made Clear and Consumer Financial Education Body websites before its launch in April.


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Readers' comments (46)

  • I'd like to offer an “advice-type” service that isn't regulated. Is there a form ?

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  • So am I and all of the other hard working, regulated, fee paying IFA's going to have to continue to fund this new competitor's business model, fat salaries, bonuses, pensions....
    You honestly could not make this up!

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  • Well, can the Office of Fair Trading now help us then?

    We in the industry are required to fund MAS - which is now stating they will be competing against us (as we could charge a client a fee for 'non-regulated advice', which MAS appears to want to offer free, they are in direct competition with the advice industry).

    It seems MAS have an unfair advantage - which is very much anti-competitive!!!!

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  • Just fell off the chair laughing. 'Advice type' advice from an organisation with Advice in it's title. But it's not advice, let's be clear about that. Unreal. You really couldn't make this stuff up.

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  • That should clear up any confusion that consumers had over the Money "Advice" Service that didn't give advice, only information and guidance, and now gives an advice-type service, but not proper regulated advice!

    Brilliant, what a joke!!

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  • Are they taking the mick, we are paying for this!!!
    Perhaps they can pay me some money so that I can offer my client advice!

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  • I'd like to offer an "advice-type" service that isnt regulated and paid for by others who are is what you really mean!

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  • This is the 'thin edge of the wedge' - how great it is to think that I am funding (as an IFA) a competitor to my own business!

    I would say that TO BE HONEST I'm being TOTALLY shafted by both the FSA & THIS LOT IN FEES!

    What a stitch up!

    If anybody who was totally impartial to the Financial Services Industry could see what was going on - they would laugh uncontrollably at how Regulation was not so blatently biased & against IFA'S!

    God help us!

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  • "advice type service"

    Isn't this just an admission that the guidance only approach didn't have any appreciable effect!

    What does advice like service mean unless it is advice.

    If it is personal, directional and assertive then that sounds like sales to me. To be directional you need to recommend something. How can this be unregulated.

    Very very confused!!

    Perhaps it would be best and just admit the MAS service was a bad idea, quietly sweep it under the carpet, and save the industry millions of pounds of levy.

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  • My clients pay me to provide them with advice. They are also aware that a part of their fees cover our regulatory costs and our share of the costs of the FSCS. What I have not been discussing with them is that they are also funding the MAS.

    I need to do some research on this to be sure but I would suspect that they would generally be more than happy to help fund financial education. They would, however, probably be appalled to hear that some of their fees are potentially being used to fund advice for their next door neighbour!!

    I, like many of my peers, do provide our time regularly on a pro-bono basis. Also, we never tell a client that they cannot afford us and regularly do price work well below our tariff rates to support those individuals who need help.

    It would be really interesting to understand whom they are employing to provide this advice, what qualifications they have, how they are paid and, if unregulated, who monitors and polices this advice.

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