The Money Advice Service has shelved plans to introduce a piloted digital service as it put nine roles at risk of redundancy due to scrapping its entire marketing budget.
The MAS announced its 2016/17 business plan today, which confirmed its overall budget would reduce by 7.5 per cent to £75m and its £8.83m marketing budget would be cut entirely.
MAS chief executive Caroline Rookes told Money Marketing an “assisted digital service”, that was piloted for six weeks with Money Saving Expert, will not be permanently rolled out due to the MAS being shut down.
The pilot combined online and telephone support and the MAS said last year it was reviewing the pilot results with a view to offering a version of the service through financial guidance websites.
Rookes says: “In view of the announcement at the Budget things like that have been out on hold.”
Elsewhere, the MAS is also continuing to work on filling guidance gaps, particularly for people in the “squeezed middle” and because many existing services are small and local.
It will invite third-party organisations to bid for use of a £7m fund intended to develop the services currently on offer.
Rookes considers the latest business plan builds on the “excellent foundations” of the agency’s work in 2015/16 and will continue to help people manage their money.
She adds: “[It is] also to start to make the transition from the Money Advice Service to the new organisation.
“What we mean by that for 2016/17 is starting to build the capacity and expertise for commissioning money guidance once the new organisation comes into being because the proposals are we will not have a direct service and we will not have a consumer brand, we will commission through others.”
The MAS is working with the Treasury and the FCA on the transition and a steering group with representatives from the three organisations has been set up.
On the eradication of the marketing budget, Rookes adds: “It is something that has been very controversial throughout the life of the Money Advice Service and it is clear that although the proposals that were published at the Budget were still only for consultation it was clearly the intention we would not spend any more on marketing.”