The Money Advice Service (MAS) has scrapped its entire marketing budget as the Treasury looks to dismantle the service.
In his Budget, chancellor George Osborne announced plans to scrap existing money guidance services such as MAS in favour of a new body.
The plans to scrap the service followed an independent review into MAS led by former National Association of Pension Funds chief executive Christine Farnish. The review suggested a number of changes MAS should implement, including cutting its marketing budget.
The body, which is led by Caroline Rookes (pictured), spent £8.8 million on marketing its services to the public between April 2015 and March 2016. In the previous year it spent £12.7 million on marketing.
Last December MAS pledged to cut this in half to £4 million in its business plan. However, MAS has now revised its business plan after Osborne’s announcement.
Its new business plan, published this morning, set out plans to scrap its marketing budget entirely. MAS will also stop funding all face-to-face money guidance sessions it funds. However, it will continue to offer debt advice.
As a result of making these cuts, MAS has cut its total budget by £6.1 million to £75 million.
MAS said the number of people it offered guidance to would fall to 15 million as a result of cutting its marketing budget, compared to 26 million in 2015.
The body said it would work with the Financial Conduct Authority (FCA) and Treasury to help set up the new guidance service.
‘Within the Money Advice Service we will set up a transition programme. This will come under the leadership of HM Treasury, working alongside the FCA,’ it said.
‘The aim of this group will be to help HM Treasury as it makes plans and sets out legislation for the new money guidance body. The group will also ensure the new body can have a highly complementary relationship with the new pensions body also planned by the government, and will clarify which assets and roles will later be needed from MAS.’