Debt advice economic benefits to society of up to £960m in the UK
Today the Money Advice Service is pleased to publish The Economic Impact of Debt Advice, a report that demonstrates a financial return of up to £960m per year to the UK economy. This is in the context of an estimated £150m and £200m total annual investment in debt advice.
The research, undertaken by Europe Economics, builds on work previously carried out by others in the sector and shows that the debt advice services provided have significant direct and indirect economic benefits for the society at large.
There is a well-established link between debt problems and health issues and this new research highlights that debt advice provides up to £145 million in health benefits every year across the UK. The evidence also suggests that there is a causal link between being indebted and reduced productivity, with debt advice delivering productivity gains of up to £137 million. Debt has also been found to be a significant barrier for those seeking employment.
Sheila Wheeler, Director of Debt Advice at the Money Advice Service said: “This report clearly provides more evidence of what those of us working in the sector have known for a long time – investing in debt advice pays. Not only does debt advice contribute to health benefits – and in particular mental health benefits – for those receiving it, but it benefits employers through increased productivity. Crucially, it pays off for creditors too, reducing their costs by up to £237 million a year and increasing debt recovery of up to £360 million annually across the UK
Sheila adds: “We hope these findings will help many across the sector support cases for increasing their availability of debt advice and to engage with the broad range of beneficiaries more effectively. With Peter Wyman’s independent review of debt advice funding underway, this work demonstrates just how valuable debt advice is.”
Peter Tutton, Head of Policy at StepChange Debt Charity said: “We welcome this timely report adding more evidence on the scale of the value debt advice delivers through helping people deal with problem debt. It also highlights the enormous social costs that will continue to accrue if we do not find policy solutions to stop people from falling into problem debt and better help those currently in need. With millions of households struggling, the role of debt advice will become even more significant.”
For more information please contact:
Money Advice Service Press Office
(m): 07966 964991
NOTES TO EDITORS
About the Money Advice Service
The Money Advice Service is an independent organisation. It gives free, unbiased money guidance online at moneyadviceservice.org.uk or via free phone on 0800 138 7777. It also manages the delivery of Debt advice across the UK, which is provided through a variety of partners. The Service was set up by Government and is paid for by a statutory levy on the financial services industry, raised through the Financial Conduct Authority. Its statutory objectives are to enhance the understanding and knowledge of members of the public about financial matters (including the UK financial system); and to enhance the ability of members of the public to manage their own financial affairs.
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