Money News
The long-awaited Thoresen Review of Generic Financial Advice is now out. The report sets out a high-level blueprint for a national Money Guidance service to provide people with the 'knowledge, understanding and confidence' to make better decisions about money issues. It adds that the service should offer a combination of telephone, Internet and face-to-face guidance.
The report makes a number of recommendations - not least a national Money Guidance service that should be governed by the principles of impartiality, supportiveness, crisis prevention, universality, as well as being sales-free.
The service should focus on giving people information and guidance on budgeting, saving and borrowing, protection, retirement planning, tax and welfare benefits, and jargon busting. It should stop short of recommending specific products, however.
The report goes on to say that the most appropriate way of delivering a Money Guidance service is a partnership model, with a central body to direct the strategy, set standards and deliver some services, but with much of the service actually delivered by accredited partner organisations which could include those who already do such a good job helping people with their money.
The report adds that City watchdog, the Financial Services Authority (FSA), should take forward the national Money Guidance service project and that in view of the real benefits that would be delivered by such a service, the costs of providing the service should be equally split between the Government and the financial services industry. The industry's share should be raised via a levy, with contributors drawn from firms regulated by the FSA, consumer credit firms regulated by the Office of Fair Trading, and National Savings and Investment.
To ensure that the national Money Guidance service can be up and running as soon as possible, the report says the Government should set up a regional pathfinder service as soon as it has had the opportunity to consider this report. The Review believes a large-scale pathfinder that enabled the report's recommendations about the service to be thoroughly developed and road-tested should last around two years and would cost around £10-12 million.
Report author, Otto Thoresen said: "I believe that good money sense needs to be as much part of people's lives in the twenty-first century as healthy eating and keeping fit. 'Money Guidance' will help people deal with the money matters that shape their everyday lives budgeting their weekly or monthly spending, saving and borrowing, insuring and protecting themselves and their families, retirement planning, and understanding the technical language that we in the financial services industry too often use."
03 March 2008 © Moneyextra.com
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