Letter to the Minister for Pensions and Financial Inclusion on proposals to recommission debt advice

Guy Opperman MP
Parliamentary Under Secretary of State (Minister for Pensions and Financial Inclusion)
9th November 2021
Dear Guy,
I am writing to express my concerns about plans to recommission debt advice services in England and Wales, and to urge you to pause the process to allow additional scrutiny and assessment of the impact the proposals will have on debt advice provision. As things stand, debt advisors fear that the proposals will decimate in person debt advice, which is vital part of debt advice provision for many vulnerable people, in addition to those who have experienced a significant life event who are overwhelmed and in crisis. 
From the information I've seen, and from the details shared with me by debt advice services, the Money and Pension Service's (MaPS) proposed model from April 2022 will see 74% (£59 million pa) being directed towards national remote contact centres who will focus on debt advice by phone and online services. The remaining funding (£20 million pa) will be split between three regional areas to fund both remote and face-to-face debt advice services - this will mean a funding cut for regional face-to-face service provision of around 50-60%.
Whilst the contract itself will see an increase in overall funding for debt advice nationally, the importance and value of robust and accessible face-to-face debt advice services should not be ignored by Ministers, and by cutting funding for in-person debt advice provision the Government risks many of the complex and sensitive cases that specialist debt advisors deal with not being picked up and managed in a way that prevents hardship, homelessness, and future health and wellbeing. 
Whilst many excellent and experienced debt advice services adapted their ways of working during the pandemic to continue their essential advice work, this should not be mistaken as a more efficient way of working in the long term. Of course, online and telephone debt advice plays an important role for many people, but in particular for those largely able to self-help, and those who have online resources available already. The proposed changes neglect those who are most vulnerable and need in-person advice, such as those with poor literacy, those who are digitally excluded or cannot access support by phone, and those who have simply lost control of the situation - which can often be the case when people spiral into debt due to the nature of many debts being triggered by a significant life change, and the emotional upheaval this brings. 
In my Brighton Pavilion constituency, the excellent Money Advice Plus and Citizens Advice currently hold contracts to provide debt advice, and who between them support nearly 2,000 people each year. With the MaPS proposals pushing for larger regional hubs, and with a focus towards online and telephone debt advice, smaller, experienced charities who have provided debt advice will not be able to compete for contracts, and the quality client-centred approach which supports some of the most vulnerable residents in the city risks being lost.
As we move out of the pandemic it is vital that debt advice remains accessible in our communities, and that changes which have the potential to threaten this accessibility should be paused to allow additional time to seek greater input from existing advice services about the best way forward. I am particularly concerned by the timetable for change, which would see decisions being made in January, which would result in existing debt advice services having to make staff redundant in the New Year, right at the time when debt advice services are under the most pressure following the Christmas period. With new contracts starting on the 1st April 2022, the current timeframe for the MaPS proposals being implemented would see an unsettled debt advice sector at the most critical part of the year for debt advice provision. 
Given the significant impact that the proposed MaPS changes could have on debt advice provision, I am urging the Government to:
 - pause recommissioning to allow for independent research into future debt advice demand, and for additional scrutiny from the debt advice industry, and other linked services to be considered before proceeding
 - to review the concerns being raised by advisors in the debt advice sector about the current Debt Advice Peer Assessment (DAPA) scheme
 - to increase, not cut, funding for face-to-face community debt advice in any service recommissioning
Whilst I very much recognise the benefits of telephone and online debt advice and the role this plays in supporting many of those in debt to access support, I am hugely concerned about the MaPS proposals as they stand, and the threat to community face-to-face debt advice. Debt is often difficult for people to acknowledge, it is often linked to other lifestyle or wellbeing issues, and neglecting the benefits or face-to-face advice in any remodelling of debt advice provisions is short-sighted, and risks more complex cases not being handled effectively out the outset and preventing longer poor outcomes as a result.
I hope that you will reconsider pausing this process to ensure that the concerns within the debt advice sector can be addressed.
Yours sincerely,


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