Scottish Government

2 THE RESEARCH EVIDENCE

Introduction

2.1 Having considered what money advice consists of and how it is delivered, this chapter provides a brief overview of the different money advice giving approaches and the individual clients who receive this support. It outlines the potential costs and benefits which result from this provision, and reviews the evidence on the relative effectiveness of different advice giving practices. Finally, evidence and recommendations on how to improve money advice practice are considered.

What is money advice?

2.2 According to Fearnley (2008: 1), "the purpose of money advice is to assist people in managing their debts via a range of possible methods, including negotiating repayment schedules with creditors (either via informal arrangements or debt management plans [ DMP]), maximising income, and in some cases making use of statutory insolvency options" . Whilst money, or debt advice, provides assistance to individuals already experiencing problem debt, ¹⁶ financial capability (or financial literacy/education) focuses on promoting money management skills to different sectors of the population at different points of their lives.

How is money advice delivered?

2.3 Money advice is primarily delivered face to face, although many organisations also offer telephone services as well. While all CAB offer advice online, only around one in five non- CAB providers in England and Wales offer a website or online advice in addition to face to face and telephone advice ( IFF Research Ltd 2007: 5). Self-help materials are distributed by almost all bureau, but only by 70% of non- CAB providers (Ibid). Money advice giving methods roughly fall into the following categories:

• face to face advice consisting of group and one to one advice and coaching, financial capability workshops and training, outreach work, or intensive specialist support for individuals with learning disabilities, for example
• telephone help to provide actual advice or simply as a referral mechanism, reminder or text messaging service
• internet or online counselling to provide self help packages or to direct clients to other advice agencies or forms of advice

2.4 In addition to the above methods, agencies also engage clients through television campaigns, leaflets, posters, directories and other written information.

2.5 When developing the Scottish National Standards for Information and Advice, Communities Scotland (2006: 7) ¹⁷ suggested that advice is likely to comprise some or all of the following components:

• listening to clients
• diagnosing the problem
• giving information
• advising on the options available
• taking action on behalf of clients
• negotiating on their behalf
• representing clients' cases at tribunals and courts
• referral where appropriate and
• enabling or empowering the individual to take informed action on their own behalf

2.6 Clients are offered advice which will either help them to pay of all or part of their debt, or in the case of bankruptcy, none of it. The above options can be achieved through signing up to a DMP or the Debt Arrangement Scheme which involves complete repayment, or to a Trust Deed, a formal arrangement with an insolvency practitioner, which can be made protected, and which involves part repayment . In the course of offering money advice, almost all providers negotiate with creditors on behalf of clients in order to secure reduced fees, payments and interest rates as part of a DMP. Debts can be consolidated into one payment, a discount on the amount owed can be secured (typically between 10-20%), penalties and charges can be stopped and a lower level interest rate paid. Such solutions are regarded as benefitting the financial sector as well as individual clients. The Consumer Credit Counselling Service ( CCCS), for example, states their service will ensure creditors gain from better educated and 'rehabilitated' clients, improved recoveries and the establishment of reliable payment systems for individual debtors. ¹⁸ In addition to assisting with arranging debt management or debt relief solutions, money advisers also help with income maximisation by, for example, informing clients about benefits they are entitled to claim. Debt advisers also make referrals to specialist agencies where necessary and represent clients in court, although this is less common.

Clients

2.7 Early attitudes towards debt tended to pathologise those in debt as feckless, irresponsible and inadequate. Department of Trade and Industry research (Kempson 2002), however, suggests that most people get into debt as a result of being very poor - "More than half of households who are over-indebted have incomes of less than £7,500 per year" (quoted in Williams 2004: 5).

People on low incomes are already living on a very tight budget.
They generally have very good money management skills but life events - such as losing a job, illness, separation or having a baby - can tip them into problem debt.
Social Exclusion Unit 2004: 3

2.8 No data on the overall personal indebtedness of representative Scottish households was found. However, CCCS provide some limited evidence on levels of debt in Scotland. ¹⁹ A 2007 report analysed their Scottish service. Patterns of indebtedness in Scotland are generally similar to those in the UK as a whole. There are few major differences, bar slightly lower annual income and debt levels ( CCCS Scotland 2007: 12). According to CCCS Scotland research (2007: 4-14), in Scotland:

• the amount of debt owed is falling across all ages, although fewer clients had the means to repay their debt in 2008 ( CCCS 2009: i) ²⁰
• the proportion of people over 60 seeking advice has more than doubled in the last five years (to 10%) - correspondingly there were 13.4% less younger people (aged 25-39) seeking advice in 2007 than in 2003
• the majority of clients (57%) are over 40
• increasing numbers of women (52.3% in 2003 and 57.3% in 2007) are present with debt problems ²¹
• couples owe on average £31,239, single females owe £17,355 and single males £19,712
• 61.3% of clients rent their own homes (five years ago there was an almost even split between tenants and homeowners). On average, the 38.7% of homeowners owe nearly twice as much as tenants ²²
• The average debt of people in Scotland is 22 times their monthly income
• There has been a 106% increase in the number of clients seeking help (from just over 1,000 in 2003 to over 2,600 by the end of 2006). ²³

2.9 The 2008 CCCSUK statistical report indicates that among clients starting a Debt Management plan, the debt to income ratio is higher in Scotland than any other part of the UK. More generally, CCCS report that their clients are becoming more affluent, with 12% having net annual household incomes greater than £30,000 and 47% of clients being homeowners ( CCCS 2009). Fearnley (2007: 10) points out that until we agree what over-indebtedness is, we will not be able to properly define the identity of the over-indebted population.

The economic cost of debt

2.10 This review did not uncover any systematic or conclusive evidence on the cost of debt in relation to individuals or population sub groups, service delivery or the wider economy. No evidence on the cost of unpaid debt written off by creditors was uncovered either. Pleasance et al, however, provide an estimate for the average cost of debt to the public (in lost economic output) at over £1,000. ²⁴ While evidence on the implications of debt for local authority budgets is equally limited, Williams (2004: 13) does cite Shelter estimates that it costs local authorities between £1,913 and £3,190 to evict a tenant for rent arrears. This cost relates to raising Possession Orders and Bailiff's Warrants, having void periods for properties, loss of rent, possible vandalism and most significantly re-housing tenants.

Avoiding court action

2.11 A number of researchers (Pleasence 2007 and Williams 2004) highlighted the link between debt counselling and a reduced burden on the courts, noting that as a result of counselling debtors are better able to negotiate with creditors and thus avoid costly court action (Williams 2004: 6). Counsellors can assist debtors to express their problems in legal terms which help to resolve disputes out of court. This can help to iron out the unequal distribution of legal skills which tends to result in those in most need being the least effective at accessing welfare schemes. Counsellors can further assist debtors to complete paperwork, choose appropriate routes through court and negotiate settlements. A US study (Seron et al 2001: 419) found that the reduced number of court motions enhanced the efficiency of this process. In turn, the costs of court action, which defendants simply cannot pay, can be avoided by creditors.

The cost of debt advice

2.12 The wider costs of indebtedness can be set against the cost of advice itself. The legal Services Commission and Department for Constitutional Affairs set a fixed figure of £196 for advice for debt problems ( LSC and Do CA 2006). The same figure for advice delivered through National Debtline stands at £25 (Pleasance et al 2007: i). More serious problems are, however, likely to cost many times this to resolve (Pleasance et al 2007: i). ²⁵ Similarly, other advice giving methods such as face-to-face and more involved forms of advice are more costly than online support.

Paying for increased demand

2.13 Research by the Scottish Poverty Information Unit (2009: 1) maintains that "between 4,330 and 4,500 paid and volunteer advisers provide money advice to around 1.1 million clients at a cost of around £160 million to £165 million each year". Government sources provide most of the funding for this work whilst the finance and credit industry provides only around 3 per cent (ibid). In turn, it is suggested that "there are an estimated 0.5 million people whose current demand for advice is not being met, a further 0.5 million people who would benefit from money advice if awareness and access were improved, and 1 million who may benefit due to the current economic situation. Such additional advice would cost around £110 million per 0.5 million" (Scottish Poverty Information Unit 2009: 1).

The personal costs of debt

2.14 As the literature cited below illustrates, debt affects the health and well being, self-esteem, relationships, peace of mind, quality of life, financial, employment, legal and housing status, of those involved. Debt makes it difficult for those involved to lead a normal life. Individuals can become indebted as a result of changing circumstances such as ill-health, loss of employment or relationship breakdown. Distressing consequences for parents' relationships with their children were, for example, noted in one study (Pleasance 2007: i, Turley and White (2007: 3). Turley and White (2007: 3) identify two other causes of debt (besides changed circumstances) as money management such as a lack of understanding regarding managing finances, and creditor behaviour.

2.15 Indebtedness can be experienced by anyone at any stage of their life and can take many years to clear, particularly for those on low incomes. Turley and White (2007: 3) report that respondents discussed "a cycle of debt during which the causes mounted and increased". ²⁶ Consequences are also cumulative as individual debt impacts on partners, children, local communities and society as a whole. Debt, therefore, has a wider economic and social cost and is not an isolated personal problem.

The cost of relationship breakdown

2.16 Evidence on the individual consequences of indebtedness is partial and unsystematic. Although Williams (2004: 8) states that there is no quantification of relationship breakdown as a result of bad debt, he indicates that anecdotal accounts do exist. For example, relationship breakdown is cited in CAS (2009b: 50) research as one of the main causes of becoming indebted. The resulting costs of divorce and family breakdown (which could be offset against the cost of advice) are not readily available.

The cost of stress

It has made me stressed, it has made me not well, I got my second child, I had to give up work, my mum's disabled, I was worried because my wages weren't going into the debt. A lot of the time I was quite depressed about it because they were phoning me they were hounding me and I didn't have anything to give them but they weren't listening.
Interviewee ( CAB research 2009b: 50)

2.17 William's (2004: 10-11) research cites "stress or anxiety as the most common consequence of financial difficulties", indicating that Citizens Advice reported a quarter of those with debt problems have sought medical help for stress, depression or anxiety. A Finnish study (Williams 2004: 10) concluded that 70% of over-indebted households in the city of Vantaa suffered mental health problems. Chronic stress does have a knock on affect on physical health such as Coronary Heart Disease, hypertension and diabetes which are likely to have financial consequences for the National Health Service. Other side effects include eating disorders and increased smoking and drinking. In 1992 the Confederation of British Industries attempted to quantify the real economic cost of stress and mental health related problems to society, concluding they cost around £5bn through lost work days alone. When viewed in terms of an estimated decline in productivity/output (at 30% per salary), this works out as 1% of GDP. ²⁷

The benefits of debt advice to clients

2.18 The majority of literature reviewed reported a clear positive impact of debt advice. Changes in the experience of debt, the circumstances surrounding debt problems, and the ability to deal with these problems as a result of receiving advice included:

Perception of circumstances;

• spending less time worrying
• improved emotional outlook (feeling reassured and less anxious and depressed)
• regarding situation as improved
• reducing feelings of isolation, shame and guilt

Health and wellbeing;

• experiencing positive health and well being effects (although evidence for this was regarded as inconclusive in the Pleasence (2007) research)
• avoiding stress-related problems

Levels of debt and income;

• overall improvement in financial circumstances -- 36% reported completely sorting out their debt problems after 12 months, 6 in 10 felt they were partially sorted out ²⁸
• falling levels of dept -- by an average £7,585 twelve months later ²⁹
• increased benefits income --15% of advice agency clients reported increases (Pleasence et al 2007: 10)

Practical improvements;

• finding it easier to pay and to target 'priority' debts
• finding it easier to live a normal life
• improved ability to pay off debt at a manageable rate

Knowledge and understanding;

• Improved confidence
• increased knowledge about own finances andabout financial matters overall - 84% reported feeling more knowledgeable about financial matters (Pleasence et al 2007: 13)
• increased ability to stop getting into further debt
• ability to avoid legal action and action by bailiffs

Improved stability and relationships;

• having more housing stability (again seen as inconclusive by Pleasence)
• improved relationships with partner, husband or wife and children

Relationships with creditors;

• improved relationships with creditors

Avoiding criminality;

• reduced debt as a factor in criminality ³⁰

Avoiding student drop-out

• prevention of students dropping out of higher education as a result of encouragement and coping strategies

(Pleasence et al 2007: I; Turley and White 2007; Williams and Sansom 2007: 1-3 and Williams, T. 2004: 6-14).

2.19 Receiving money advice can also help to prevent individuals becoming indebted in the first place or control the manner in which problem debt escalates and infects other areas of one's life. Turley and White (2007: 57) highlight how receiving debt advice helped to prevent respondent's situations from getting worse by constraining mounting debt, preventing action taken by creditors becoming more serious, and improving personal circumstances and emotional health. Respondents further reported how receiving advice had prevented them from dropping out of university or college.

Improving health and well being

2.20 There is a correlation between higher income and better health although there is still uncertainty about the contributions of absolute and relative economic wellbeing to morbidity and mortality. Nevertheless, there is good evidence that determinants of indebtedness such as unemployment and job insecurity have a significant negative impact on health (Marmot and Bell 2009). The World Health Organisation Commission's report on the Social Determinants of Health ( CSDOH) emphasised the fundamental importance of social determinants such as income and employment in determining health and wellbeing. One of the reports key recommendations is that governments': "Establish and strengthen universal comprehensive social protection policies that support a level of income sufficient for healthy living for all" ( CSDOH 2008).

Improving benefit uptake

2.21 One of the positive consequences resulting from debt advice is more effective take-up of benefits entitlements. Although estimates for unclaimed benefits recovered have been suggested, this information is not systematically recorded by debt advisors. It is clear that money gained by individuals tends to be spent in the local community and is also subject to the 'multiplier effect'. US research (Braley 2002: 44) on the benefits of legal aid in Virginia claims that this cash injection benefits local economies "in the form of salaries, rent and goods and services purchased from local businesses". The law and economics model highlights how debt advice positively generates additional finance and jobs for individuals and communities. The contrary argument points out the negative consequences of poverty which exports hidden costs to the wider community. For example, in relation to the loss of the asset value of owner-occupied properties in poor areas (Williams 2004: 24).

Possible complications

2.22 The above benefits cannot be assumed to be evenly experienced by different individuals, groups of people or particular institutions/infrastructures. Additionally, the impact of debt advice does vary over time. Some respondents in the Ministry of Justice ( MOJ) study, for example, were not as positive about the outcomes/benefits gained 12 months after receiving advice. ³¹ In the Pleasence research (2007:16), the percentages of those who believed advice assisted them to avoid or curtail legal action dropped from 76% to 54% twelve months later. There were exceptions to this rule, however, as health benefits, the ability to live a normal life and the amount respondents worried about their debt problems continued to improve over 12 months. ³²

2.23 Despite significant increases in financial literacy, over 70% of clients stated that they would again look to their adviser for assistance (Pleasence 2007: 14). This indicates that in addition to a possible decline in the benefits and impact of advice over time, the increased knowledge and confidence gained from it does not necessarily equate with increased independence or an ability to self-help over the long term. More sustained support could help to shore up benefits over time and improve increased independence in the long term.

The effectiveness of different money advice giving approaches

2.24 This review found no systematic comparative evidence that different types of advice, for example, face-to-face or online, provide different levels of impact. The effectiveness of individual approaches tended to be reviewed as a subsidiary issue. The following evidence has, therefore, largely been gleaned by finding relevance within research with a different primary focus.

Self-help packs

2.25 Although it is common to provide individuals with information packs there is little evidence on "the utility and effectiveness of legal self-help" (Giddings and Robertson 2003: 112). Giddings and Robertson point out that research does not distinguish between user and professional expressions of satisfaction with advice. Users tend to be much less critical and they are not generally asked to quantify the benefits they identify.

Telephone advice

2.26 Little evidence was found in relation to telephone advice. Respondents in the Turley and White (2007: 66) research did, however, demonstrate very low awareness of National Debtline - a free national telephone helpline - which may indicate that awareness of telephone advice services is not as high as it could be.

Online Counselling

2.27 The use of online counselling has increased in recent years and in 2006 the CCCS launched Debt Remedy, an online process which performs an immediate assessment resulting in emergency help, self-help material or an online counselling session. Telephone counsellors are available to provide support. CCCS states that this anonymous service greatly increases their "capacity to reach more people for a fraction of the price" of core helpline and face-to-face activities ( CCCS 2008: ii). ³³CCCS Debt Remedy also enables the organisation "to reach a different, younger audience than our traditional telephone-based service" ( CCCS Scotland 2007: 2). Online advice options do not attract representative samples of users, and there were distinct socio-economic differences between users of online and telephone help. Debt Remedy users, for example, are wealthier, more likely to be home owners, have higher rates of debt and have more personal loans, catalogue and store card debts ( CCCS 2008: 20-21). Overall, there is little evidence of the relative affects of online counselling techniques.

Outreach Provision

2.28 HM Treasury funded research (£6m through the Financial Inclusion Fund to pilot money advice outreach services to disadvantaged and 'hard-to-reach' individuals) conducted by the Legal Services Commission ( LSC) indicates that nearly a third of people with money problems are getting advice from the wrong places, for example, family and friends and creditors rather than money advisers (Buck et al 2007). The pilots were located in urban and rural settings, included a mix of new and pre-existing partnerships and were based in locations from prisons to Sure Start centres, credit unions, housing offices and schools. As well as fixed point projects in institutional settings, the pilots also incorporated 'roaming' outreach advice (Buck et al 2007: 2). The study illustrates how difficult it is to get the right advice to the people who need it the most:

• 31% who had experienced real financial difficulties reported not having received any advice at all
• 22% reported that they would not seek professional advice even if they were having serious money problems (Buck et al 2007: 153).

2.29 Interviewees in the 25 locations typical of the LSC's money outreach pilots frequently mentioned the accessibility, familiarity, trust and professionalism of the outreach locations as an incentive to seek advice (80% said they would use LSC's outreach pilots) (Buck et al 2007: 154).

2.30 The study concludes that results offer a compelling view of the potential benefits that can be realised through outreach advice and that "money advice pilots could have a significant positive impact" (Buck et al 2007: 15-16). In response to the findings, Carolyn Regan, Chief Executive of the Legal Services Commission stated that:

It is clear from the findings that the most hard-to-reach and disadvantaged

people welcome money advice in locations they are familiar with. The

Commission is reforming civil legal aid to commission services where they are most needed - rather than were they are based. ³⁴

2.31 Pleasence et al (2007) also considered easily accessible money advice outreach services to be the most appropriate for those reluctant to or who do not consider seeking advice. Where advice is delivered, as well as how it is communicated is, therefore, an important factor which determines the relative success of different approaches (Scottish Government 2007).

Financial capability

2.32 Poor money management is cited as one of the main reasons why people get into debt (Pleasence et al 2007, Turley and White 2007, and CAS 2009: 44). Correspondingly, evidence also supports the importance of financial capability initiatives in preventing debt problems arising in the first place (Pleasence et al 2007: ii). Financial capability is about being able to manage money, keep track of one's finances, plan ahead, choose financial products and stay informed about financial matters. ³⁵ Research by the Financial Services Authority ( FSA) (2009) confirms that financial capability is complex and variable, with fluctuations in capability levels occurring at different life points and in relation to different groups of people. Financial capability is both preventative as well as post hoc, helping individuals adjust to new, perhaps unexpected, challenges such as redundancy or bankruptcy. As such, it functions as both a form of education and advice.

2.33 Respondents in the Turley and White (2007: 65) research indicated that it would be useful to teach school children about the value and meaning of money and how to manage and account for it. It is also suggested that people with debt problems could go into schools to talk to children about their experiences. In January 2007, the then Economic Secretary to the Treasury asked Otto Thoresen (2008: 1) to "review how best to deliver a national approach to generic financial advice". Following a programme of engagement, analysis and research, the subsequent Thoresen review for HM Treasury set out how best to deliver a national service.

After a year of working on this review I now passionately believe that a service that provides impartial Money Guidance is badly needed… Looking ahead, as people live longer and with increased personal responsibility, they will have to rely increasingly on themselves to provide for their futures. A national Money Guidance service can only become more vital in any strategy for improved financial capability.
Thoresen 2008: 2

2.34 Although acknowledging the difficulties entailed in quantifying benefits, measuring changes in attitudes and ascertaining long term benefits, the review anticipates a number of outcomes and behavioural changes for users of money guidance services. Potential high level outcomes for users include:

• awareness of budgeting principles
• keeping in touch, opening financial letters and paying bills on time
• knowing where to get help and information
• planning ahead
• making better choices as a result of knowing what questions to ask (Thoresen 2008: 29).

2.35 Behavioural changes include:

• better budgeting
• management of debt
• 'shopping around'
• investment in pensions
• increased protection (Thoresen 2008: 34).

2.36 In addition to benefiting clients cost-benefit analysis conducted by Thoresen (2008: 1) identifies "substantial benefits to users of the service, to the financial services industry and the Government". ³⁶ The review concludes that there is clear demand for a national information and guidance service, suggesting 75% of survey respondents said they were likely to use such a facility (Thoresen 2008: 7). It states that it is essential to use a range of approaches to engage with users and recommends effective engagement and marketing strategies are developed to ensure that everyone believes that the service is for them and that it engages them in a suitable way (Thoresen 2008:12). The government accepted the recommendation that a large scale 'pathfinder' (or pilot) be set up in the north east and west of England to reach up to 500,000 to 750,000 people over a 12 month period from spring 2009. A national service is due to be rolled out in Scotland in 2010.

Issues about practice

2.37 Despite a scarcity of evidence on the relative benefits of different advice giving methods, the review did uncover a number of practical recommendations on how to deliver a more successful service.

Identifying what kind of advice is sought and why

2.38 It is clear from the research reviewed that in general, effective approaches to money advice take into account the:

1. accessibility of the service/advice sought

2. quality and appropriateness of the advice itself

3. long term consequences/outcomes which result from seeking this advice.

2.39 Turley and White (2007: 4) distinguish between two broad categories of advice as:

• formal advice - assistance with payment plans, dealing with creditors, information about benefit entitlements, legal advice and representation and so on
• informal advice - emotional support, money saving tips, dealing with bailiffs [not applicable in Scotland] and assistance with letter writing

2.40 Respondents in the Turley and White study (2007: 6) suggested that assistance should be grouped into three categories: factual information; advice and guidance; and emotional support. Within these categories respondents stated that:

• advice should come from a trusted and respected source with well trained, qualified, professional people who are kind and helpful, have good language skills and give technically accurate information
• help should be independent, impartial, confidential and non judgemental as well as easily accessible (i.e. readily, widely and locally available) and affordable
• ongoing support with the same person and continuity of care should be available
• help should take account of the full range and type of problems, clients' different backgrounds, specific needs and circumstances, and be clear simple, easy to understand and have practical relevance.

2.41 Turley and White (2007: 4) indicate that the main motivations for seeking advice included: encouragement from others; desperation for help; need for information; desire to reduce debt and a need for someone to talk to. A greater understanding of the motivation behind advice seeking and of the full range of advice (formal and informal) which is required could help to ensure services are appropriately promoted and properly equipped to respond to diverse needs.

Referral practices

2.42 Scottish Government research (2007a) considers how to develop successful referral practices. Evidence indicates that single referral sources are unlikely to reach target groups in sufficient numbers and therefore, that it is 'essential' to develop links with a range of services working with target groups. Effective referral from GPs, health visitors, teachers and other specialist support workers can help to ensure potential clients are passed onto the right service to meet their needs.

Communicating appropriately

2.43 Evidence indicates that leaflets and other written information should be made accessible for different individuals (Scottish Government 2007: 2). Respondents in the Turley and White (2007: 67-68) study came up with a number of suggestions to improve the promotion of debt advice:

• making clear that advice will cater for anyone regardless of their financial situation or age, that it is confidential and free
• illustrating how services can provide practical solutions
• placing information alongside product advertising for loans or credit cards, on bills and with correspondence from banks, creditors and courts
• carrying debt warnings on financial products similar to those on cigarette packets
• advertising on pay slips, in shopping centres, health centres, GP surgeries, hospitals, through district nurses, health visitors, the Benefits Agency, job centres, libraries, child care services, solicitors and legal services.

2.44 Additionally, Scottish Government research (2007) identified successful practical strategies for accessing new clients as including:

• interactive sessions (i.e. as part of induction to prison)
• engaging with community events
• placing publicity materials in targeted locations
• posting bus adverts

When to provide advice

2.45 Financial vulnerability is exacerbated at times of change, for example, when leaving home, during relationship breakdown, or with the transition to and from work. Providing money advice at all stages of the transition into work through proactive contact with advisers is recommended by Scottish Government research (2007a: 3). Attention (Turley and White 2007: 67-68) was also drawn to the need to target people before their debts escalate and a potential role for creditors in directing attention to advice when the first signs of missed payments was identified. Creditors, it was felt, should be able to direct individuals to local advice services at the appropriate time. The literature, therefore, suggests that advice should be available to people at the right time as well as being presented in a way which is accessible to them.

Applying a client centred approach

2.46 Scottish Government research on money advice for vulnerable groups indicates that although there are some links between vulnerable groups, there is no "one size fits all" approach to advice giving for disadvantaged groups (Scottish Government 2007: 1). A flexible, mixed method approach which can respond sensitively to different client needs is called for (Scottish Government 2007). Allowing sufficient time for people to make informed choices, work with debt advice user groups and consult with other support workers is also critical (Scottish Government 2007). The research suggests that informal approaches help to build relationships and holistic and proactive approaches are particularly effective for those with mental health problems.

Addressing debt and disadvantage

2.47 Arradon and Wyler (2008: 4) indicate that many people on low incomes experience restricted access to mainstream financial services. ³⁷ This results in the imposition of costs on those least able to afford them. It also discourages attempts to start saving and makes individuals more vulnerable to loan sharks. This suggests that the links between associated manifestations of poverty such as concentrations of low income, unemployment, poor health, low educational achievements, high crime rates, poor environment, inadequate services and social tensions should be considered as part of the context within which debt is created and potentially solved (Arradon and Wyler 2008: 3). Arradon and Wyler (2008: 3) advocate a direct, 'head-on' approach to challenging the linked problems associated with debt and poverty. Others (Pleasence et al 2007) support the development of co-ordinated advice and support across a variety of services and networks. LSC research advocates the development of outreach advice projects in order to support particularly deprived and 'hard-to-reach' individuals (Buck et al 2007).

Responding to specific needs

2.48 In order to meet the often complex issues and needs some disadvantaged groups face when accessing advice, Scottish Government (2007a: 4) research further recommends that mainstream services should develop effective links with specialist agencies and trusted intermediaries. It is suggested that particular account should be taken when designing services for people with learning disabilities. For example, support should include specialist provision or partnerships between specialist and mainstream services. It is also seen as necessary to ensure relationships of trust are established with service users and carers. Pleasence (2007: 18) research confirms that "advice was more positively received when it was tailored to individual needs", for example, providing outreach advice in a friendly and familiar environment for 'hard-to-reach' groups. The development of client sensitive services such as this is both resource and time intensive, but the literature suggests it is ultimately worthwhile in order to account for specific group interests.

Staff training

2.49 The success of different advice giving services is in part dependent upon individual staff skills and the specialist training they receive. For example, providing proper debt advice for people with mental health problems often requires the skills of both mental health advisers and money advice specialists (Scottish Poverty Information Unit 2008: 1). In order to better meet the needs of vulnerable groups research recommends government provide funding for training provision and/or specialist advice provision (including second tier support) (Scottish Government 2007a: 4). The Scottish Poverty Information Unit (2008: 1) calls for the development of joint working models which would enable a variety of specialist advisers to use their specialist skills in a more coordinated way. In addition to providing good practice guidance and establishing operational standards, the Scottish National Standards for Information and Advice (Scottish Government 2006) outline a series of competencies for advisers and agencies designed to improve professional standards and performance.

Service delivery

2.50 Scottish Government (2007a: 2-3) research contained detailed recommendations on those elements which it concluded contribute to the successful delivery of money advice services. Recommendations consisted of:

• including workshops and one-to-one coaching and support
• ensuring group sessions are interactive and reflect the often linked problems of poor literacy and numeracy
• offering modular training for staff around specific group needs
• making sure non-English speaking requirements are accounted for
• ensuring staff gain a range of skills through access to the expertise of others
• using service networks, forums and working groups to encourage engagement with development projects
• encouraging the engagement of other group representatives and services when developing debt projects
• including feedback and follow up from individual services within the auditing process.

2.51 Pleasence (2007) suggested that a combination of advice delivery strategies may be most beneficial.

Unmet demand

2.52 Awareness of the factors which make advice unsuccessful can also help to avoid the development of poorly conceived and insensitive services. Turley and White (2007: 58) note that "on rare occasions respondents described the advice they were given as having no impact". This was due to the advice:

• not telling them anything new
• not offering any practical solutions to the debt problem
• failing to prevent further deterioration in their financial situation.

2.53 Respondents in the Turley and White (2007) research did express concern about the physical accessibility of the Citizens Advice Bureau as well as having to wait two or three days for an appointment. Additionally, they felt the bureau struggled to cope with the level of demand, resulting in clients having to queue outside the building at times which was particularly difficult for parents with young children on busy main roads. Views of the service were, however, largely positive, with important factors identified as the comprehensive knowledge, competence and friendliness of staff.

2.54 The literature also looks at why demand is not met. Fearnley's (2007: 8) research for the Money Advice Trust ( MAT), indicates that unmet demand can be due to; lack of capacity within an agency; lack of expertise in a particular field; access and special needs issues; client lack of knowledge; emotional or perceptual barriers or; negative prior experience of advice. The Legal Services Research Centre English and Welsh Civil and Social Justice Survey highlights the importance of obtaining useful advice as those in receipt of inappropriate advice are most likely to fall from the system due to referral fatigue/failure. ³⁸ The survey also draws attention to the difficulties entailed in navigating the "advice maze" (ibid). Knowledge about the barriers which prevent individuals seeking advice, such as feelings of shame and embarrassment, low awareness of sources of advice and the inaccessibility of certain organisations, should inform the design and promotion of advice provision (Turley and White 2007: 4).

Telephone advice

2.55 The review also revealed limited recommendations on specific advice giving approaches. With respect to telephone advice, respondents in the Turley and White (2007: 66) research suggested that it would be useful to have a Customer Support Manager at Utility companies to speak with individuals having problems paying their bills.

Face to face contact

2.56 Commenting on the effectiveness of face to face advice, respondents in one study (Turley and White 2007: 64) emphasised the need to meet an adviser in person as this:

• made it easier to understand technical and complex financial matters
• allowed respondents to express themselves more effectively
• resulted in eye to eye contact which was regarded as reassuring
• and made discussion of documents and budgeting more practical.

2.57 Respondents (Turley and White 2007: 64-66) also suggested face to face contact could be improved through:

• the provision of a private room to discuss sensitive issues
• the development of an internet chat room where people could access advice and support after a face to face visit
• home visiting services for those with mobility problems
• the offer of counselling
• solicitors holding surgeries like MSPs do
• providing local drop in centres
• making debt advice available in universities and colleges.