The Money and Pensions Service (MaPS) has announced an increase in its budget for debt support in England in 2020/21 by £38million. And an additional £5.9 million is being allocated to Northern Ireland, Scotland and Wales.
This new money is in addition to the existing MaPS budget for debt advice of £64 million.
It will come from a combination of government funds, reallocated MaPS budget and an industry levy. The details of the industry levy have not been given. MaPS says it is is also working with the FCA to:
establish a fairer and more sustainable debt advice funding approach for the future.
MaPS will set out the process for how it will allocate the funds in the coming weeks.
Why 60% more?
This is a 60% increase in the budget for debt advice.
Before the pandemic hit, MaPS had estimated that over 5 million people in the UK had regularly missed payments to debts and so were in need of debt advice.
Its early modelling now suggests that this will increase by 60% to 8 million people over the next 18 months, peaking around the end of 2021.
Caroline Siarkiewicz, MaPS Chief Executive, said:
When the greatest demand for debt advice hits, potentially in 18 months’ time, we need to be ready and that means acting now.
It’s a good start!
We need more than just money, we also need to look how we can best use it.
I set out an approach in Coronavirus – how the debt advice sector should be planning. One of the 5 measures I proposed there was better debt advice funding. That isn’t just more money, as I said:
MaPS knows the huge problems its current debt advice contracts are causing. Just sort them. Get out your red pen and scrap the targets, bureaucracy and DAPA. Also extend the contracts by three years and give everyone a pay rise.
And I looked in more detail at the crucial area of insolvency in Coronavirus & the reform of Personal Insolvency in England. By making the process of giving debt advice and helping clients through insolvency faster, we can help more people with the same number of debt advisers. And at the moment experienced debt advisers are in short supply.
So if we get these changes to debt advice and debt solutions right, this new £38million will be able to help even more people.
But right now, new money and fast is very welcome.
barbara clafton says
that excellent news- cant wait to see the improvements for advisers .
Valerie Thompson says
Good news, any idea how local CABs can bid for it? We are not in a highly deprived area so get nothing from the CitA debt pot.
Sara (Debt Camel) says
not yet!
Ali says
nice to hear but this will not stop people leaving the debt advice sector. I have been a debt adviser for 8 years and would consider other options. The scrutiny we are put under working for CAB is demoralising. 22 page confirmation of advice letter to a client who will never read it. IFR’s pulled apart because assessors want to use the rules to highlight what we have done wrong rather than justify the outcomes being correct and in the best interests of the client. I have worked on both sides of the fence. I have worked for a fee charging debt management company and the FCA liked the advice model at the fee charging company- the advice was straight forward, in the clients best interests and they were told why things were not in the clients best interests and clients were not overwhelmed. Advice letters were about 5-6 pages which included the I&E. Why can’t MaP’s do the same thing and simplify the advice model and process? especially when the right outcome has been accomplished and in the best interests of the client?
Claire Ponsonby says
I agree with everything you say Ali, coming from a long standing Banking background I have been a debt advisor (trainee for the main part) 12 months now and I feel like as I am typing my letter of advice, I may as well type my biography as most clients take one look at the length and give up. There is a high percentage of vulnerable clients who for various reasons have accrued debt, they need help and just want it sorted not a 22 page letter explaining the red tape after we have already gone through the initial advice either face to face or over the phone!
This comment above says it all :
MaPS knows the huge problems its current debt advice contracts are causing. Just sort them. Get out your red pen and scrap the targets, bureaucracy and DAPA. Also extend the contracts by three years and give everyone a pay rise.
Jacqueline says
I agree with everything that you have said Ali. I left CAB 2 years ago to work as a debt adviser for another independent charity but we are still funded my MAPS so still have all of the issues that you have mentioned in your post. The CAB I worked for; in addition to all of the above points were/are placing advisers on discipline procedures if the notes/work isn’t on the system within 3 days of seeing the client; which can be very difficult when you see clients everyday and have no admin support.
Considering I’m contracted 35 hours per week and my target is 8 people per week; I’m in interviews for 2 hours at a time (16 hours per week at least), then lets say 30 minutes each entering each client onto the case management system plus filling in paperwork (4 hours per week) and 2-3 hours per person writing the notes up (16-19 hours per week). This is before I’ve done any confirmation of advice, written/emailed creditors, gotten a DRO/bankruptcy on the system, chased any outcomes/paperwork/responses or started on any charitable applications. The numbers speak for themselves.
10 years experience and I’m looking to leave debt advice but waiting for the right opportunity to come along. Hopefully I’ll be able to sleep at night again!
Darwin the Debt Cat says
Excellent news! Knowing MaPS, that will mean an extra 87 managers and 2 debt advisers across the UK! Oh, and a 30% increase in targets! Joy!
Darwin the Debt Cat says
So, in reply to my own comment:
We have now heard from our lead organisation regarding allocation of some of the ‘extra money’. Now, apparently, we will have a new job role created; a Team Leader.
Our Team Leader will sit somewhere between a caseworker and a supervisor and do….. well nobody is really sure….. Oh and we will have extra ‘quality assessors’ at the lead organisation.
As for more caseworkers, and a reduction in target so we can actually open, and progress cases….well no… But we have been told we can hire trainees because, well because, there are no qualified caseworkers as the sensible ones have all left.
MaPS should be renamed Many and Persuasive Spreadsheets….
Sara (Debt Camel) says
oh dear, I am going to struggle to forget that acronym…
Suzanna says
Why not use the £100 million to pay off the debt instead , wouldn’t that solve a whole host of stress and hardship with debt paid off and make the money go further by only paying a dividend in the £ owed making the £100 million cover £200 million of debt for example.
Sara (Debt Camel) says
Citizens Advice estimated there were £19billion of arrears in household debts, not consumer debts, in 2018. Things have got a lot worse. Paying off a tiny proportion is not a sensible alternative to helping millions with their debt options.
Stephen john Rowe says
Hi Sara , I have come out of work in the last month and have experience offering debt advice to customers over a long period of time.I would be very interested in applying for work in this sector of the CAB.M y back ground was as a Housing Officer.Can you offer any advice on the best way of applying for such positions?
Many Thanks
Sara (Debt Camel) says
Ads I have seen recently include:
http://www.moneyadvicetrust.org/whoweare/Pages/Vacancies.aspx
Rightsnet has a Jobs page: https://www.rightsnet.org.uk/jobs
If you are an IMA member, their weekly bulletin has a Vancies section at the end: https://www.i-m-a.org.uk/
karen brown says
We are largely funded by MaPs as a face to face service do you think they could withdraw funding due to the fact we cannot do this at present or adjust their thinking and allow us to continue with bespoke telephone advice?
Sara (Debt Camel) says
I would be astonished if they withdraw funding because of that!
Amanda Jane Heath says
Will this money go to debt advisers that aren’t funded and don’t want to be funded by MAPS? There’ s 1,000’s of us out here who don’t want to go down the target routes that Maps has but still have no access to any Government funding
Sara (Debt Camel) says
so far as I know, the money for England will be distributed by MAPS. There is a real problem here.
Amanda Heath says
This is so sad to see all this money going to Maps funded centres and debt advisers struggling so much under these targets. We re blessed to not be funded by them but are always looking for funding and so far dont want to even look at it if these targets dont change.
Mike Farrell-Deveau says
Absolutely scrap the targets and DAPA. We spend more time and resources worrying about meeting unachievable targets and the massive amounts of data we have to record and produce than we do actually giving meaningful advice. My colleagues and I spend more time discussing how to meet DAPA requirements and cut down the workload than anything else and it negatively impacts how we deal with clients because we end up having to force them through a process that they have absolutely no desire for or understanding of just so we as advisers can tick boxes. The entire system is an abuse of clients and an abuse of advisers. Targets should not be set for things that you have absolutely no control over, it creates unnecessary stress and negatively impacts the ability to deliver advice to a good standard. It also drives competent advisers out of the door.