Every UK adult will be entitled to free generic financial advice within five years, the government announced today.
The service will be aimed at providing consumers, including those on low incomes, with "quick, easy and simple access" to good quality advice on financial products.
In advance of the initiative going live, a task force has been set up to research and design the national generic financial advice service. The group will be lead by Otto Thoresen, chief executive of the financial services firm Aegon UK.
Mr Thoresen will report to a ministerial group led by Ed Balls, economic secretary to the Treasury, by the end of the year.
The government aims to have a programme in place in time for the introduction of the low cost pensions scheme, known as personal accounts, in 2012.
Extending financial advice to all consumers is seen as a key part of addressing the general lack of understanding about long-term savings and investment products.
Mr Balls said: "We want everyone in society to have access to, and use, financial services with confidence. Financial decisions are difficult. Financial products are complicated and there is too much jargon.
"This puts people off, or they can end up buying something that is not right for them. Sometimes people just want to discuss their financial options and not buy anything."
He added he was determined that generic advice should be extended to all consumers who need it.
The government also announced an expansion of financial education in schools.
Coinciding with the launch of the first Child Trust Fund (CTF) week, Mr Balls and pensions minister, James Purnell, said a package based around CTFs would include new teaching aids for schools and more support from financial education bodies, in a bid to improve financial literacy among schoolchildren.
Responding to today's announcement, the Association of British Insurers (ABI) said it was "delighted" by the government's commitment to improving financial capability.
Stephen Haddrill, director general of the ABI, said: "The challenge is to stimulate people to take a greater interest in their financial affairs and to give them more confidence to take advantage of the wide range of advice already around.
"There is a lot of detailed work for the task force to do, including on value for money. But this looks like it could create a consensus on the best and most cost-effective way forward."
Teresa Perchard, policy director of Citizens Advice, said: "There is a significant need to help thousands of people make the most of their money, both now and in the future. This a real chance to tackle the 1.4m debt problems which poured into our bureaux last year.
"The Citizens Advice service is already the largest provider of free money advice in the UK. We are very keen to move from the 'accident and emergency' of debt advice to the providing of financial health services.
"A long-term government strategy like this could have a massive impact on tackling debt - we wholeheartedly welcome this initiative, and will do all we can to help make it a success."
Source: Guardian Unlimited
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