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MPs: MAS ‘doesn’t know what it’s doing on money advice’

Caroline Rookes
Caroline Rookes: At the Treasury select committee

The Treasury select committee has attacked the Money Advice Service for not being clear about its objectives and spending, claiming it ”does not know what it is doing” in regards to delivering financial advice. 

MAS chief executive Caroline Rookes appeared before a TSC sub-committee hearing today as part of an inquiry into the service which has lasted more than a year.

MPs hit out at the MAS 2013/14 business plan for being unclear and for allocating money to be spent on marketing instead of face-to-face advice.

TSC sub-committee chair George Mudie said: “Your business plan says out of a £46.5m budget you only spend £8.8m on service delivery. That is the underlying unease we have about the flowery language in this report. We don’t know what the hell you are doing with it.

“If you cannot find ways of delivering a service on money advice and you have to spend it on marketing, transition costs and core operations, it leads us to believe that your organisation doesn’t know what it is doing on money advice.”

Conservative MP Andrew Tyrie said: “You may now realise the scale of the concern around this committee about what has been going on at MAS.

“The business plan is completely meaningless and only gives us a rudimentary understanding about what is going on. There is considerable unease about the way this money is being spent.”

Conservative MP Jesse Norman also criticised the MAS business plan for not being clear about its objectives.

Rookes, who took over the top job in January, defended the organisation and said it has turned itself around since last year and is now performing well.

She said: “I know there was a lot of concern about the MAS and what it wasn’t doing. I think it has a good business plan and we published results for the MAS performance last year and it was good. It is an organisation that is performing well. There is a long way to go but it is going in the right direction.”

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Comments

There are 16 comments at the moment, we would love to hear your opinion too.

  1. And, who is paying for this fiasco? I wish I could get on this gravy train these guys have managed to get tickets for. Instead we bang our heads on brick walls until it hurts trying to get value for our clients and make a living in an ever decreasing circle of an industry watching operating costs spiral out of our control whilst these organisations just plunder our pockets. At least questions are being asked by the TSC but what difference will it make?

  2. An ‘adviser’ from the MAS recently spoke to my sister about issues. Got her income calculation for a pro rate job completely wrong, her ISA allowance completely wrong. These people should not be allowed to give ‘advice’ unless they are QCF 4 like everybody else. They are misleading at best, downright dangerous at worst.

  3. Gosh it takes the TSC a year to get this far. That in itself is hardly impressive. So will the MAS do the same as the FSA and just stick up two fingers?

    If so we have the huge waste of the MAS added to which we have the expense of the TSC that just appears to ruminate without coming to real conclusions or the power to get results.

    If this is their findings then the last paragraph should have been-

    “You’re fired and the whole thing will be wound up tomorrow. In these straightened times there are better things on which we can spend scarce resources. £46 million quid will buy us a new local Hospital or 5 Apache Attack Helicopters for the Army or two secondary schools”

  4. I think we have to give Caroline the chance to continue to turn things around. MAS has a part to play in the provision of financial ‘advice’ to the huge number of people who cannot afford to source advice from professional intermediaries.
    But if there isnt considerable improvement in the way money is spent (and as James points out, it is this industry which is meeting the costs) then it must be closed replaced. And I mean well within the next 12 months.

  5. Utterly shambolic, a poor never-going-to-work idea dreamed up by people who are clueless, and worse still, clueless with our money.

    Although we had no choice in funding it, IFAs are entitled to our opinion, and this was clearly a ‘jobs for the boys – and girls’ project, starting off their first Chief Exec on 250kpa in charge of an organisation advising people on debt management. Says it all.

    And now, with Hobman gone, we now have a Chief Exec named C.ROOKES.

    How ironic……

  6. A stunning amount of money being spent on… what? That is the question we have all been asking for ages. A decent website with professional pdf attachments costs a few thousands, maybe tens of thousands with a database. This is costing tens of millions, which is out money and yet they are not accountable to us. Now imagine if this is an example of how the whole of the FSA was run, no wonder it was a fiasco. FCA…what will change?

  7. i was originally involved as a volunteer delivering information seminars to employees at various public and private organisations for the ‘first draft’ of this organisation.The concept is a worthy one,particularly since RDR has removed access to independent financial advice to a significant tier of Society.The question i could never answer was,’If i ran an organisation that didnt have to pay the vast majority of my staff(volunteers)should i be able to deliver the objectives with a modest budget’.Apply this to your own business and strip out two thirds of your wage bill,now see if you can make a profit!!!!!!!!

  8. When I turned 65 I could see I was being edged out from my livelihood as an IFA by new qualification demands of the RDR so I approached the MAS for a job. I was turned down because they said the MAS didn’t give advice! I was sure I could help people to find their right approach so they would be able to choose an IFA with knowledge, but I think I scared MAS with my 30 years’ knowledge. C’set la vie!

  9. Dick Sprinkler 25th June 2013 at 9:49 am

    Pathetic !!

    Business Plan ?

    Dont make me laugh – who needs a business plan when you have a virtually open cheque book of OPM, no real accountability and all business decisions have no financial downside at all !!!

    In any other walk of life it would be bankrupt in much the same way as all quangos.

    We’re the one who’ve got it all wrong !!

  10. @Derek Vivian
    the mas was set up because government knew people like you would leave due to RDR.
    Why on earth would you get to your stage in life and start all over again?
    It is precisely people like you mas should be employing. 30 years of experience is not to be despised.
    If mas had employed advisers who were leaving due to the fact they were nearing retirement age, they would have been able to deliver a reasonable service which may have given them a better foundation.
    They deserve the criticism

  11. Harry, you missed one. £46 million could also pay for nearly a whole day’s interest on the government debt!

  12. Anonymous, I think you are absolutely right! I wanted to continue for at least a further 5 maybe 10 years being fit and healthy. But, just go to the MAS web site click on jobs and see the titles for those running the service and requirement for being employed. It is mind blowing that it seems necessary for such high experience to give generic advice and that experience wasn’t required to be as a practitioner. Says it all really! I hope the MPs dig deep into this one for all the people disenfranchised from getting independent advice.

  13. if it is there for the general public to use then it should be tax payer funded and totally separate from the FCA. That way the TSC could actually force it use TP money wisely. As it stands the gravy train that is MAS will still be here in one form or another for many years to come. The FCA will not allow it to go away (it may also get a name change), it will still be here. And why????? Because once the regulator accepts that parts of it can be disbanded or dissolved by MP’s because it does not give value for money, they know it is only a matter of time before its own empire starts to be demolished and they simply will not allow this to happen in any way shpae or form. It is pathetic, truly pathetic

  14. I feel like this is swimming against todays tide, but I actually support the concept of MAS, that said it is not clear on its deliverables and it is funded by an industry it is not supporting.
    Personally I would rather see qualified pension industry professionals, not necessarily QCF4 as this is guidance not advice, helping people than gobsh*tes like Martin Lewis who through comments so wide reaching something is bound to stick and is considered an expert on financial matters?
    It does have a part to play and I do think it deserves a chance to right its own wrongs and b*llockings from MP’s who offer no constructive suggestion isn’t going to help.

  15. Matt, exactly what those of us in the IFA industry said when the Government came up with the idea to replace those IFAs who could no longer be around for the ordinary citizen. It should be staffed by practinioners who have experience helping those who are not experienced in financial services.

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