Industry experts have call-ed into question the feasibility of a government-backed pilot scheme aimed at tackling Britons’ debt problems.
The scheme is a result of the Thoresen review of generic financial advice, which was published last week.
Otto Thoresen, chief executive of Aegon UK, was appointed by the Treasury in January 2007 to assess the feasibility of providing generic financial advice on a national level.
His review calls on the industry to join with the government to help de-liver free advice to indebted consum-ers, funded by the Office of Fair Tra- ding, National Savings & Investments and a levy on Financial Services Au-thority-regulated firms.
But Matthew Wyles, group executive director of non-retail business at Nationwide, says: “It is in everybody’s interest that the public understands money but I question whether a quango is the solution.”
Wyles says a better answer would be for the industry to take responsibility for creating an independent body to manage a similar pilot scheme, given that regulated companies are expected to co-fund Thoresen’s proposals.
Wyles says: “We should set up an in-dependent body to operate this programme instead of it being another government initiative that might not be effective.”
The government has pledged to in-vest £12m in the pilot scheme, which is expected to run for two years, and bolster existing financial advice facilities offered by bodies including the Citizens Advice Bureau.
The pilot will focus on budgeting, borrowing, benefits, protection and re-tirement planning.
Andrew Montlake, partner at Co-balt Capital, says: “Anything that gives the public more information on financial responsibility is good.
“I’m not opposed to meeting the government half way in funding, but it should focus on preventing further increases in debt rather than saddling brokers with more responsibility.”