The Money Advice Trust has hired more than 50 staff to service £12m worth of contracts to deliver debt services, which begin today.
Last year, the Money and Pensions Service (MaPS) announced it had awarded three three-year contracts to the Money Advice Trust, fellow charity Citizens Advice and Gregory Pennington Limited (GPL) to provide debt advice services.
From today, the Money Advice Trust will receive around £9.8m per year from MaPS to deliver’ national debt advice services contract alongside the other two organisations.
It will also receive around £2.4m per year until 2026 from MaPS to deliver free debt advice to small business owners.
To service the two contracts, the Money Advice Trust is scaling up its services and has already hired more than 50 additional debt advisers.
Citizens Advice also said it was recruiting more advisers to service the contracts it has been awarded – the national debt advice service as well and a debt relief order (DRO) administration service alongside GPL.
Civil Society News recently reported that StepChange would no longer receiving around £12m in statutory grant funding for its debt advice services.
Contracts come at time of increasing need
Last year, the Money Advice Trust received £8m, around half of its total income, through a MaPS grant.
In November MaPS, an arms-length body funded by the Department for Work and Pensions, said that its new contracts would replace a previous funding system of 12-month grant agreements.
The Money Advice Trust estimates that its national debtline and business debtline services will offer advice to around 440,000 people in England over the next three years through the new contracts, which will “enable significant investment in both services”.
Its recent research found that two in three national debtline callers have had to forego buying essential items in the last six months – up from 49% a year ago – with 62% being concerned they will be unable to pay their energy bills in the next six months, up from 47% last year.
Joanna Elson, chief executive of the Money Advice Trust, said: “We are thrilled to be rolling out major enhancements to our national debtline and business debtline services in the years ahead.
“We are particularly pleased to be working in partnership with Citizens Advice and Mental Health UK to offer casework to those national debtline clients who need it – and developing improved digital tools that will improve the way that both national debtline and business debtline helps people in financial difficulty.
“These enhancements and the vital services that national debtline and business debtline provide would not be possible without the support of our many long-standing funders and partner organisations.”
Meanwhile, a spokesperson for Citizens Advice said: “Our debt advice has a huge impact on people’s lives, especially as the cost-of-living crisis deepens.
“We’re pleased to be able to continue providing vital debt advice through this funding which, over the next three years, will enable us to support hundreds of thousands of people and ultimately, help them find a way forward.”
MaPS: More people expected to need debt advice
The three MaPS contracts beginning today are worth a combined £45.7m a year, with the body investing another £30m annually in debt services through grants.
Caroline Siarkiewicz, chief executive of the MaPS, said: “Debt advice transforms lives and we’re delighted to be working with the Money Advice Trust to reach those who so desperately need help.
“This move will give people the support they need to look at their options, make informed decisions and regain control of their finances, meaning thousands more can escape the distress that debt can cause.
“With more and more people expected to need debt advice in the coming months and years, vital partnerships like this will make a massive difference during the difficult times ahead.”
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