Government Debt Advice Strategy Labelled Failure

Debt Help

A “complete failure” is what a committee of MP’s have labelled the management of the government’s strategy for helping people in debt.

51 different projects since 2004 have been uncoordinated with no-one in charge said the Public Accounts Committee.

The UK population’s total personal debt has almost reached £1.5 trillion. According to the committee’s report 11% of adults were struggling with debts.

One initiative to give face-to-face debt advice was praised by the committee.

But in general Edward Leigh MP, the committee’s chairman, was scathing.

“In 2004, the government launched a strategy aimed at improving the support to, and reducing the number of, people who struggle with unmanageable debt,” he said.

“No one is in charge of the strategy; groups intended to oversee it have not met, and there has been no reporting on its progress since 2007.

“The strategy has not been evaluated to assess whether the policy goals have been achieved and the department does not know how effective the interventions making it up have been.”

Face To Face Debt Advice

Launched by the Department for Business, Innovation and Skills in 2006, the face-to-face advice for those in debt was praised by the committee.

It described this scheme as a “gleam of light”.

“The £130m project is funded primarily from the Treasury’s Financial Inclusion Fund, and delivered locally by Citizens Advice and other third sector organisations,” Mr Leigh said.

“The department has achieved greater success in managing this particular project, which is delivering more debt advice than planned at a lower cost per person than budgeted.”

However, the report stated that even this project was failing to help all those it was targeted at, and more people could be helped with their debt if the Department for Business had a better grasp of the best ways to give debt advice.

A Department for Business spokesman stated: “The National Audit Office reports that the government has invested £600m to help people struggling with debt.”

“Close to 300,000 people have been supported by the Department for Business face-to-face debt advice project alone, and the committee has recognised that it is well-liked and provides good value for money.”

“We are already in the process of reviewing our schemes and will carefully consider the report’s findings with other departments across government.”

The committee said demand for debt advice is already outstripping supply and is expected to grow as Britain slowly emerges from the worst recession since World War Two.

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