MSE News: Debt help centres saved by government funding U-turn 11 February 2011 at 6:01PM in Debt-free wannabe 10 replies 1.9K views

Former_MSE_Guy

This is the discussion thread for the following MSE News Story:

"A last-ditch rescue effort has secured the future of many free face-to-face services for another year ..."

Read the full story:
Debt help centres saved by government funding U-turn

Crowqueen

Never has the country needed to provide decent debt help

Shouldn't that read

Never has the country needed to provide decent debt help more than it has now

?

Otherwise, brilliant piece of parliamentary work. This is a win for democracy - our political system is often called an "elected dictatorship", but it's at times like this that it really shows that it doesn't have to be.

pawnbroker_2

The attempt to stop this funding shows just how disconnected many MP's are from reality. Never was such funding more vital than it is now.

To put it into real perspective this silly coalition has elected to increase International Aid by £11 MILLION PER DAY yet cannot "afford" £27 Million to finance this necessary advice and help for a year, or similarly run the Forestry Commission for £15 Million a year.

I think we all agree on where such funds would be better spent.

SwipernoSwiping

And I can not stress enough, Forests and Advice Centres alike - they have only been granted a stay of execution. These institutions need to be putting their thinking caps on to find ways to create revenue that will mean they can exist without these handouts - (easier for CAB types than trees )

Billy_two_speakers

http://www.bbc.co.uk/news/business-12435845

about time

davidgmmafan

I was cheered by this, seems my MP was involved in some way so well done Jenny Chapman. I am aware this is only temporary but it is better than nothing.

I do worry sometimes what goes on in the minds of those in power. What is the goal behind cutting the funding? The deficit. And what if less people get good quality advice when they need it most? Why they'll get into a worse situation perhaps leading to insolvency. If that happens it means more write offs for business, which means less economic growth, which means less tax which means... the deficit is harder to tackle. I know there's a lot of ifs and buts in there, but we're not talking a bout vast sums of money here. The people this helps WON'T benefit from telephone or online advice. There are still about two million people who don't have a bank account for gods sake.

Dare I say it a (temporary) victory for common sense?

Butti

davidgmmafan wrote: »

I do worry sometimes what goes on in the minds of those in power. What is the goal behind cutting the funding? The deficit.
Dare I say it a (temporary) victory for common sense?

The Government's argument is that it needs to cut the deficit so we keep our AAA credit rating. What it doesn't explain (given that we finally paid our post WW2 debt to the USA in 2002) is why we can't spread the cuts over 4 years rather than front-loading them in the first year. 4 years would allow council's to maximise voluntary redundancies, natural wastage and early retirements and manage the process so much more smoothly. It would give them a chance at protecting essential services that they are not legally required to supply.

I do wonder what local government has done to incur this much wrath.

B

edgex

shellieholly wrote: »

And I can not stress enough, Forests and Advice Centres alike - they have only been granted a stay of execution. These institutions need to be putting their thinking caps on to find ways to create revenue that will mean they can exist without these handouts - (easier for CAB types than trees )

The rescue does not secure the future of all help centres as many also rely on local government help and other forms of funding.
For instance, five CAB drop-in centres in Birmingham could still close unless talks between CAB officials and local councillors on Monday can save them.

this is precisely the point;

the Birmingham CAB were told every year that future funding from the council was not guaranteed.
yet now that the council has to cut their funding, theyre screaming that they have no funding.

maybe they should have advised themselves about funding




heres a creative idea, offered to all the charity debt advice centres;
get a levy imposed on all credit agreements, say £1 per year on every loan, credit card, mortgage etc
have all the monies raised allocated to the advice centres

davidgmmafan

A fair point, but whilst we're talking around what if its true that every pound spent on the CAB pays for itself several times over? Then council or government cuts could end up costing money. Like the example I gave what if they prevent someone going bankrupt or similar? Surely that would benefit business and society as a whole?

Not all fee charging firms are bad, indeed I even came across the odd one referring people to CAB as it wasn't in the clients best interest to be paying their fees given thier modest income. The point is that option won't be there, which IMO will mean more people going to the wall. Its a valuable but sadly not a glamourous charitable organisation.

I say again the sum is minor, and I believe the benefits outweigh the costs.

SwipernoSwiping

No it won't work that way. If -free- Debt advice goes under - (and other legal aid supported charity aid centres too) Then - as quickly as it has in Birmingham, nationally Solicitor firms will seek to plug the gap for a fee.
Plus point of that ( and I suspect another Govt aim in the plan to cut here there and everywhere) would be there would in the end be more paid jobs for Law Graduates.
Someone somewhere is busy thinking " We all manage to find money for our divorces so we'll all find the money for advice"
It's a slightly flawed thought process.
I do think that those that cause debt, instrumental in the possible creation of debt should be asked to fund some kind of advisory. However what you have to be wary of here is the sudden wave of bank led "advisors" that advise based on bonus...
Any legislation brought to require XXX of an apr charge would have to clearly indicate that it was to fund INDEPENDANT FREE debt advice.
This way the law grads get their jobs too!

dwp_do2go

There has been a report suggesting that creditors - that's utilities, credit card companies and banks etc - actually commercially benefit from the provision of debt advice services. These are mostly funded by local and central government (e.g us) or by charities; only an estimated 3% of the costs of these services come from creditors. Surely, a more strategic contribution - perhaps a levy or something else - from ALL creditors, should be part of the solution.