Weekly Blog by Philip King, CEO of the ICM - 'A journey into the unknown'

I seem to have been reading and reviewing an endless stream of lengthy reports and consultation documents recently, including the 150 page Ministry of Justice 'Transforming Bailiff Action' consultation over the past weekend, but more of that later (and please respond when the Institute issues its consultation survey questionnaire in the not too distant future). Some of the documents have been more interesting than others but let me mention two reports relating to consumer debt and advice.

The first is 'Debt Advice in the UK', the final report produced by London Economics for the Money Advice Service. The Money Advice Service, which was initially set up by the Government, is funded by a charge levied on the financial services industry and collected by the Financial Services Authority. It replaced the Consumer Financial Education Body in April last year. In 2012/13 the Service will use a budget of £46.3 million to deliver against its money advice targets, and a separate budget of £40.5m to coordinate the delivery of debt advice across the UK. Credit professionals working in the sector will be keen to see that the financial services industry's levies are put to good use!

The report concludes that 'Overall, the desk review of the existing literature and information on the debt advice sector and the consultations with stakeholders show that, while there exists a fair body of material on individual debt advice providers or programmes, very few analyses take a more holistic approach, covering the debt advice sector as a whole or, at least, large segments of it. Notable information gaps relate to: estimates of the actual and total demand for debt advice; the volume of debt advice provision by form and channel for the sector as a whole; the needs of actual and potential debt advice seekers; and the comparative effectiveness in the short and longer run of the different forms and channels of debt advice provision.'

I may be being cynical here, but to my simple mind it seems that the report tells us more about what it can't tell us than about what it can!

The second is the 'Consumer Debt and Money Report' launched by the Consumer Credit Counselling Service as the first in a series of quarterly reports based on research carried out by Cebr. This reveals: that households are spending 24 percent of their discretionary income - £199 per month - on interest payments; that the demand for debt advice is forecast to remain high and peak in 2014 as unemployment rises across the UK; and that middle-aged and older people will be increasingly affected by debt problems severe enough for them to need to seek help, highlighting the challenging financial situation that older households face. The report predicts that CCCS's share of clients over the age of 45 will rise from a historic 28 percent in January 2005 to a projected 47.6 percent by December 2014.

I was privileged to chair the ICM's Credit Industry Think Tank last week - it's always great hearing the views of leading experts from across our industry - and, during the forum, we were reminded that personal insolvencies are falling, with 2011's figure of c120,000 representing a fall of about 15,000 over 2010. Good news perhaps, but let's bear one thing in mind: no numbers are collected for debt management plants arranged through the advice sector and these do not appear in the official published insolvency figures (another piece of missing but vital data!).

I hope at least some of the Money Advice Service's £86.8m will be used to identify the real size of the problem and the effectiveness of solutions. Without knowing where we are, it's hard to plan the route to a better place!