The Personal Finance Society believes the Money Advice Service (MAS) and The Pension Advisory Service (TPAS) should replace the word ‘advice’ in their names with ‘guidance’, to portray their service more accurately from a public interest perspective.
The society’s chief executive, Keith Richards, has written to to both bodies with the suggestion.
In light of the ‘guidance guarantee’ announced by the government in their latest budget, Richards believes it is vitally important not to mislead consumers into believing that they will be receiving regulated financial advice, which carries full consumer protection with it.
He said: “It is vital that the various bodies responsible for delivering the government’s pension reforms demonstrate a consistency of message.
“Aligning terminology will go a long way to ensuring consumers do not become confused when researching information regarding their financial planning needs.
“There remains a lot of debate regarding how the guidance guarantee might actually manifest itself. But one thing is for sure, it will place an even higher importance on the name of an organisation such as MAS to better describe the services they offer.
“Any promotion of services must be clear, accurate and not misleading. Guidance offered by the Money Guidance Service and The Pension Guidance Service would seem both logical and helpful, whilst also making things more intuitive for consumers.”
The name change recommendation continues the long-running industry debate on the differences between ‘advice’ and ‘guidance’, which Richards feels must be differentiated to the public at large. “We have to make it clear that guidance is not advice in the regulated, qualified and fully-protected sense, which is more uniquely associated with regulated financial services,” he said.
“Although certain sectors and industries can sometimes be over-sensitive about the use of terminology, we should take this opportunity to move things along from a public interest perspective, given the significance of the pension reforms.
“We accept that the advice profession does not own the word ‘advice’ – in the context that if you read something it is information, but if you are told something it can often be interpreted as advice. For this reason however, greater clarity is essential for the success of the new guidance service and to help signpost people to the right level of support.
“It makes total sense to me for both the MAS and TPAS to change their respective names to a more appropriately reflective a ‘Guidance Service’, thereby aligning themselves with guidance, rather than advice.
“The Personal Finance Society is currently finalising the development of a new consumer website which will direct consumers to MAS and TPAS and I have contacted both organisations to ask them to consider displaying a new clarity in their title and public image.
“Changing their names to include the word guidance will provide a much more understandable separation, leading to easier decision-making by the public,” he concluded.