The Money Advice Service has slashed its marketing budget for 2013/14 by 38 per cent and reduced its annual budget to £78.3m in the wake of concerns about whether the service delivers value for money.
The MAS has published its business plan for the next financial year which will see the annual budget cut from £80.8m in 2012/13 to £78.3m. Of this, £43.8m will be spent on money advice and £34.5m on debt advice, compared to a budget of £46.3m on money advice and £34.5m on debt advice this year.
The MAS says £12.5m of next year’s budget will be spent on marketing, compared to the £20m spend allocated for 2012/13.
It is targeting 480,000 “specific outcomes” for 2013/14, and plans to handle 196,000 calls through its contact centre and 190,000 queries through its web chat facility. The MAS expects to have handled 90,000 calls at the end of 2012/13.
It also expects to have delivered 88,000 face to face advice sessions this year and plans to “at least maintain this coverage” next year.
The MAS has targeted generating one million action plans this year, which are produced via its online healthcheck, other online tools and in face to face advice sessions.
In its business plan the MAS says: “Whilst the completion of an action plan is a positive step forward for consumers in helping to manage their finances better, completing a specific outcome, such as opening an account or taking out a new product, on the back of an action plan or other encounter with MAS requires significantly higher engagement to achieve.”
MAS’s half year results last month showed 283,397 action plans were produced between April and September.
The MAS has been heavily criticised for spending £20m of this year’s budget on marketing, which saw its “What does Ma Think” TV ad campaign launched in September. A previous ad campaign, aired in June 2011, prompted a wave of adviser complaints over claims the MAS offered free, independent and unbiased advice, adding: “How is that for a breath of fresh air?”
Financial Conduct Authority chairman John Griffiths Jones told the Treasury Select Committee last month said he was having “robust” discussions with MAS over its budget for 2013/14, and called for the MAS to undergo a value for money study of its business plan.
The consultation on the business plan closes on 11 February, and will be approved by the FSA in March.