The government has launched a consultation on the introduction of a new financial guidance body expected in autumn 2018.

The government is hoping to combine the Money Advice Service, The Pensions Advisory Service and Pension Wise into one single guidance body, following a separate consultation earlier this year. It has proposed that the new body adopt a mixed delivery model, delivering some services directly and commissioning external, specialised providers to deliver others.

The new body will fund providers to deliver regulated debt advice, but will not provide or support any other form of regulated financial advice. The consultation states that the purpose of the body is to ensure that people get the right support to help them make financial decisions throughout their lives, not to provide individuals with regulated, bespoke advice on specific financial decisions.

As part of its remit, the government thinks the guidance body should have a strategic role to ensure funding is directed to where it is most needed in the guidance landscape and to programmes that have been proven to work.

The government has identified five key areas that the body should focus on to help consumers access the financial information and guidance they need. Although these areas are grouped separately, the government recognises that distinctions between money, debt and pensions guidance can be artificial and that consumers often have more complex guidance needs.

The five areas that the new guidance body will deliver or commission services are in the provision of debt advice for those in problem debt, provision of information and guidance on matters relating to occupational or personal pensions, accessing defined contribution pension pots, and planning for retirement, providing information to help consumers avoid financial fraud and scams, provision of information for people on wider money matters and co-ordinating and influencing efforts to improve financial capability and co-ordination of non-governmental financial education programmes for children and young people

Furthermore, to inform the debate on the single financial guidance body, the government has developed a set of principles to consider when weighing up proposals for changes to the financial guidance landscape. These are being consumer focused, offering value for money and having sustainability.

The government said the new body will be best placed to decide how to deliver its service but it expects it to provide a multi-channel information and guidance service, including a customer facing website, a telephone service to access pensions guidance and the provision of some face to face support.

Commenting on the consultation, AJ Bell senior analyst Tom Selby said: “Financial guidance, particularly in relation to pensions, has become increasingly disjointed, with three major levy-funded organisations operating in the pensions space. The government has now recognised this approach is inefficient and potentially confusing for savers.

“Moving to a single guidance body should reduce the costs paid by the industry – and ultimately by consumers who buy products and services – and create a simpler system. Information and guidance, in partnership with regulated financial advice, have a vital role to play in boosting engagement around pensions and finance in general. Creating effective signposting to regulated financial advice will be crucial in ensuring people get the financial help they need.

The consultation runs until 13 February 2017 and can be viewed here.

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