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As part of the first Financial Inclusion Fund (FIF) announced in the 2004 Pre Budget Report, £45 million was allocated to increasing the provision of free face-to-face debt advice in England and Wales up until April 2008. This has now been extended by another £85m until April 2011 (see below).
The primary aim of the project is to deliver a step change increase in the number of advisers, and hence in the number clients assisted, within geographical areas and/or social groups both characterised by high financial exclusion. This was secured around a year after launch.
A Bid Request Document to attract grant applications was launched in late 2005. Following careful scrutiny of the dozens received, a total of 16 final bids for a share of the fund were approved in March 2006. The selected bids involve many independent advice providers as well as Citizens Advice Bureaux. They include three national projects, one for Wales, and one for each English region.
The projects target specific geographic areas or social groups where financial exclusion is a major problem. Many are specially created partnerships between Citizens Advice Bureaux, members of the Advice UK network and other independent advice providers.
Research has shown that although debt advice is readily available in many forms, for example, telephone help lines and the internet, people with severe or complicated debt often need to deal with someone face-to-face, and are often the hardest to reach.
The Department has worked closely with leading organisations like Citizens Advice, AdviceUK, the Money Advice Trust and the Advice Services Alliance, who represent the vast majority of current advice provision, to drive this work forward. We are very grateful to all those who have helped us deliver such a successful project in which around 500 new advisers have been recruited, trained and deployed and over 169,000 clients seen and helped.
On 14 March 2007, the Treasury announced that there would be a new FIF in the spending period from April 2008 to 2011.
On 6 December 2007, the Treasury detailed that the debt advice budget of this FIF would total £76m. The Treasury announced a top up of £9m on 9 May 2008 so making for a budget of £85m in the current three year Spending Period. This allows support for the infrastructure in place, and providing debt advice so successfully, to continue.
Evaluation Report
The project was independently evaluated in the first half of 2007 and the Report and BERR's response is on the right hand side. This concentrated on the start up phase and gave a positive appraisal of the actions taken.
A second independent evaluation followed in the first half of 2008 and the Report and BERR's response is, again, on the right hand side. This covered the period by which the project had achieved its steady state and was delivering at full capacity. It is very pleasing to note the comments which stated:
“Findings indicate that there has not been widespread funding displacement.“
“the project as a whole is now meeting targets, with some individual projects exceeding expectations“
“Projects have succeeded in reducing waiting lists. The client survey also shows success in delivering advice via outreach services to clients who would not otherwise access debt/money advice. Over half (58%) of FIF clients surveyed using the service said they would not have got debt advice elsewhere.“
”Projects are reaching an above average number of financially excluded and vulnerable clients“
“Because of the way projects were originally designed, they succeeded in reaching a financially excluded audience.“
“Costs were kept under control and, for the most part, projects achieved what they originally set out to do in the bidding phase.“
“Similarly, FIF clients are overwhelmingly positive about the advice which results show has made a considerable impact on their lives (not just the original debt/money problem).“
“The client survey results are overwhelmingly positive about the FIF debt advice service suggesting the clients place a high value on the service they receive. Nearly nine out of ten (87%) clients report that the service met or exceeded their original hopes and expectations and more than nine out of ten (92%) would recommend the service to others. The results also suggest that FIF advice provides a service to those who would otherwise not receive advice.“
“the FIF project has succeeded in providing additionality to the sector, both in terms of attracting new advisors to the sector and the impact extra advisors have had on client outcomes“
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