The independent inquiry into the Money Advice Service must look at whether the service should continue to exist as a statutory body, according to Treasury select committee chair Andrew Tyrie.
On Friday, the Treasury announced the terms for the review which will be led by Christine Farnish and will assess the effectiveness of MAS and recommend any changes it sees as necessary.
Tyrie says: “The terms of reference appear to omit several important issues from the scope of the review, including whether the MAS should exist as a statutory body, and whether its governance arrangements are sufficiently robust.
“Clarification is needed, before the reviewer starts her work, that the Treasury expects her to examine these issues.”
The MAS was established under the Financial Services Act 2010 and is funded through a levy on the financial services industry, including advisers.
The Treasury had a review of the service planned before the committee published its report on the MAS in March. It gave the service a “stay of execution” but called for the internal review the Treasury had planned for the service to be made independent.
It said: “First, given the then minister [Sajid Javid’s] endorsement of the role of the service and of its effectiveness, we are concerned that the Treasury may already have decided that the service should continue to exist in its current form.
“We therefore recommend that, rather than conducting a review itself, HM Treasury commission an independent review of the service.”