Business

Budget 2016: Money Advice Service to be abolished

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The Money Advice Service (MAS), which has provided financial and debt advice to consumers since 2010, is to be abolished, the chancellor has confirmed.

It will be replaced by a smaller advice body, according to the Treasury.

The Pensions Advisory Service (TPAS) and Pension Wise will also be restructured, to ensure consumers get the financial advice they need.

The two new bodies will offer consumers separate advice on pensions and money.

Together they will deliver "more funding to the front line" the government said, "and offer support on the greatest areas of consumer need".

The MAS had been criticised in two official reports.

One study commissioned by the Treasury found that few members of the public had even heard of it.

And two years ago the National Audit Office found the MAS was not always delivering value for money.

"We will work with the government to fully consider the implications of this announcement," said a spokesperson for the MAS.

"In the meantime we will continue to fulfil our statutory role to help people make the most of their money."

The MAS spent about £80m a year, but much of its income came from an industry-based levy.

Christine Farnish, a former head of the National Association of Pension Funds - who examined the MAS for the government - said the abolition was good news.

"I think it is a welcome development which will allow a more efficient and focused organisation, which will add more value for consumers," she told the BBC.

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