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MPs launch stinging attack on Money Advice Service

Treasury select sub-committee members have launched a stinging attack on the Money Advice Service, accusing it of “scrambling around” for a purpose to justify its budget and being an organisation which has “lost its direction”.

During the committee’s first evidence session into its inquiry into the service today, Labour MP Mudie attacked MAS for lacking a purpose at a time when Government policies are about to have a “horrifying” effect on people’s finances.

After Consumer Credit Counselling Service head of external affairs Delroy Corinaldi said the MAS has made “public noises” about not wanting to be provider or a regulator of services, Mudie questioned what its role actually is.

He said: “That sounds very worrying. If they do not want to be a signpost, or this that or the other, does anyone know what their agreed role actually is? It has been set up, with this money and it seems to me they are scrambling around to find a role at a very sensitive time.

“All I pick up from the written evidence is the damage they might do from looking for a role instead of just being a signpost and working to fill in gaps.”

Conservative sub-committee member Mark Garnier said: “It is an organisation that has lost its direction, no-one knows what the point of it is.”

Nearly everyone giving evidence to the committee today complained that engagement with the service had been poor in the past but had improved recently.

Mudie suggested this improvement had been triggered by the MPs’ inquiry into the service.

Moneysavingexpert.com founder Martin Lewis agreed. He said: “Things have got better because of this inquiry. They know people like me were going to come here and give them a good kicking.”

Asked by Garnier how effective MAS has been in consulting, Association of British Insurers director general Otto Thoresen said: ““It was non-existent for a long time but it is engaging now and I am sure this inquiry is a part of it.”

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Comments

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  1. This underlines a response I made to a different article last week when it was announced that MAS wanted to get involved in financial education in our schools. I said then that this was little more than empire building – that such a cause was not part of MAS’s remit and that the head honcho should keep his nose out of such matters. I think we have enough regulation and busy-bodying without MAS taking up the mantle as well !

  2. So does this mean that the £1,000 MAS want from me next month I won’t have to pay them anymore?

    Mark Garnier is wrong by the way MAS hasn’t lost its direction. It never had a direction in the first place

    Someone has just told me MAS was reported” to be a waste of public money” – bloody hell it wasn’t public money it was ours!!

  3. Martin Lewis says things changed because he ‘gave them a good kicking’.
    Really?
    Seriously what difference has Martin or any other so called ‘pundits’ made to the decision making system for both MAS and FSA.
    Both organizations will continue to rip everybody off because they are ‘untouchable’.
    MP’s telling us that they are concerned-what a laugh,what can they do about it?
    NOTHING

  4. Can we have our money back please !!

    The FSA ride around on a horse called black bess we been robbed !!!

  5. On a MAS platform last autumn a high profile financial journalist joked that the thing about IFAs is that they are not independent and they know FA.

    His comment went unchallenged by those who had invited him to speak. Opportunity for MAS to engage constructively gone.

  6. MAS could be useful to IFAs IF as its main directive was to engage with the public and once generic details provided for whatever they are looking for, give the consumer details of at least 3 IFAs in their postcode area to consult further on. That way, the service could be viewed as promoting Independent Financial Advice, openly and ethically, without claiming to be something it is not (ie – Set up by government and our advice is independent”

    That referral service should not be something those local IFAs should have to pay for, we already pay for the service and quite frankly it is currently of little value to us.

    No Government money has been employed in setting up this service, the FSA were the designers of it orginally and quite frankly it is just another rip off of OUR hard earned money which we pay to the regulator as fees.

  7. Moneysavingexpert.com founder Martin Lewis agreed. He said: “Things have got better because of this inquiry. They know people like me were going to come here and give them a good kicking.”

    Martin Lewis is like a lot of those at the FSA – self appointed ‘experts’ with no qualifications!

  8. The MAS will have a very important role in the near future when RDR has seen off the last of the IFAs…

  9. The MAS should have a large part to play as a conduit for people who have disengaged with financial services to be reintroduced to the benefits of professional financial advice.
    Instead they comment on matters that they should leave alone and come up with poor advertising campaigns about their website but not about who they are.
    Its a shame and an expensive waste of time.

  10. I wrote a few blogs ago about the fact that the money spent on advertising £25million would enable 50,000, yes fifty thousand people to have £500 worth of fee paid advice from IFAs who charge fees.
    This ‘credit’ would mean 50,000, yes fifty thousand clients were introduced to fee based IFAs and RDR would be on its way.
    It seems a number of other bloggers would like the same sort of result!
    Over to you all to do something with this idea.
    ps I am, not and never have been -Hector Sants or Keith Carby!!

  11. MAS was doomed to failure the minute it’s current CEO was appointed. Tony Hobman has never led a successful organisation in his overlong career and has managed to put at least one into bankruptcy. Why was this man even ever considered for the role on his inflated salary? I appreciate tPR may have wanted to be rid of him but really…

  12. Stephen W Roach. Chartered FCSI. 15th June 2012 at 5:24 pm

    The House of Commons Treasury Committee meeting of 13th June 2012 was most enlightening if not breathtaking. With representations from no less than the high profile TV personal finance presenter Martin Lewis and the appealing Tracey Bleakley CEO of the Personal Finance Education Group, together with the CEO of Money Advise Service (MAS). MAS would appear to be little more than a Quango. Its Chairman/CEO appeared highly embarrassed, the body language said it all. He acknowleged that MAS receives a budget of £40 million pounds “but not at the Tax Payers Expense – it is provided to us by the FSA”.
    He acknowledge that MAS had not engaged openly and had not achieved its original objectives.
    Suffice to say Martin Lewis was at his best, well briefed and articulate, making sense where others prevaricate.
    The simple conclusion is that on a social responsibility basis if not a cost benefits analysis, the Government must support Financial “Education” to the nations masses, the up and coming generations in particular.
    I would highly recommend the following link: http://www.parliamentlive.tv/Main/Player.aspx?meetingId=10923&st=15:19:10

  13. MAS and its predecessor the Financial Capability Division of the FSA have never really been accountable, or been able to display any real return on investment. They have played around identifying target audiences such as parents of young families, unemployed young people and offering workplace seminars on basic finance. All laudable, perhaps, but how do they justify spending their immense budget, which often goes to highly paid ‘consultants’ – often ex FSA personnel?

    Surely the money they have spent would have been better channelled into existing agencies such as Citizens Advice Bureau, etc who have been counselling the financially disenfranchised for years. Just look at their comparison site for annuities – a specialised area if ever their was one. It is vague and potentially dangerously ill – informative.

    The MAS offices are located in prime real estate within Canary Wharf, the salaries are high (with associated bonuses) and the staff expanding. This does not include the recruitment of training and consulting agency fees. I guess scrapping the service with the associated costs and redundancy payments would make the eyes water!

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