FUNDING FOR ADDITIONAL MONEY ADVICE

12 FUNDING FOR ADDITIONAL MONEY ADVICE 1. Reason for report The reason for this report is to advise Members of Scottish Executive funding which has been made available to local authorities specifically for additional money advice provision and to ask Members to agree a method of allocating this funding within Dumfries and Galloway. 2. Background 2.1 The Scottish Executive has published the Debt Arrangement and Attached Bill, which it says will provide a workable but humane alternative to the enforcement procedure of poinding and warrant sales by the end of this year. The Bill implements the recommendations of the Working Group on a Replacement for Poinding and Warrant Sale in its report Striking the Balance: a new approach to debt management. Proposals in the Bill include: a) a statutory national debt arrangement scheme to help people repay debts in a managed way free from the threat of enforcement action; b) new incentives for debtors and creditors to reach negotiated settlements out of court; c) a new, less intrusive enforcement procedure which will target only those who can py but won t; and d) provision of money advice and information in court within the court process. Subject to parliamentary approval, the Bill is expected to come into force on 30 December 2002. 2.2 In April 2002 the Scottish Executive issued guidelines setting out the intention of making additional funds totalling E3 million per annum available to local authorities for local money advice provision across Scotland. A copy of the guidelines is appended for information (Appendix I). 2.3 Dumhes and Galloway has been allocated &70,000 per annum based on data on the number of claimants of Income Support/Job Seekers Allowance. 2.4 Local authorities, as key funders of existing local money advice services, are seen by the Scottish Executive as best placed to ensure the additional resources complement existing. provision and that additional services are available as soon as possible. 2.5 The expectation from the Scottish Executive is that the funding should be used to support additional trained money advice workers. The Scottish Executive monitoring will be against the additional staffing as a result of the fbnding (Output indicator) and the additional debtors assisted as a result of the funding (Outcome indicator). 2.6 Currently Dumfries and Galloway Council core funds Dumfries and Galloway Citizens Advice Service (DAGCAS) to provide welfare and benefits advice. The Scottish Executive money advice guidelines say that in making a decision on how to use the additional resources, local authorities should consider whether there is a choice of providers of money advice for the client. Report Office of the Chief Executive Report

- - - 12 2 3. Allocation of Funding within Dumfries and Galloway 3.1 It is suggested that the following.process be adopted to ensure that the best additional service provision is available to those in need of debt advice in Dumfries and Galloway. Stage 1 - agencies within Dumfries and Galloway already known to provide this type of advice be given the opportunity to express an interest in providing additional money advice for a period of up to three years. A detailed note of what service provision is expected would be sent out and a copy is appended for information (Appendix 11). Stage 2 - an officer group, comprising representation from Modemising Services Team and the Revenues and Audit section of Finance and Corporate Services, the Office of the Chief Executive and a representative from the voluntary sector to act as an external independent assessor, use the evaluatiodassessment criteria as detailed in section 3.2 of this report as a basis for comparing and scoring submissions from agencies. Selection will be based on written submissions with the option of receiving a short presentation from each agency if more information is necessary for selection. Stage 3 - the agency is selected and following approval, a contract is signed and work commences. If officers are given delegated powers, work could commence by September 2002. 3.2 The suggested criteria for evaluation and assessment are as follows: Additionality of money advice service provision over existing baseline provision as evidenced by: the number of new money advice workers 0 the anticipated additional number of clients advised the reduction in debt cases overall improved access through the use of new information and communication technology systems Proposed arrangements to ensure the effective targeting and prioritisation of the additional resources being made available Proposals to ensure effective project management and monitoring arrangements Arrangements proposed to ensure appropriate standards of good practice are maintained in the delivery of the service including a commitment to equal opportunities Proposals to ensure public communication and publicity arrangements of the new advice opportunity Support to the delivery of the inclusion strategy and the three approved local area strategies which target our most deprived areas - North West Dumfries, Upper Nithsdale and Wigtownshire with the particular aim of contributing to the reduction of community poverty and deprivation 4. Conclusion 4.1 This additional funding will benefit Dumfries and Galloway as it will lead to an increase in the proportion of people in difficult financial circumstances able to access benefits advice and, as it is targeted at deprived areas, it will help those most in need. 4.2 If Members are minded to give officers delegated powers, work would commence by September 2002 and Members will be kept advised of progress. Report Office of the Chief Executive Report

5. Consultation The Senior Management Team, the Community Planning Manager and the Modernising Services Team have been consulted in the preparation of this report. 6. Recommendation Members are asked to 6.1 agree the process for allocating the additional resources for local money provision; 6.2 agree delegated powers to officers to approve the fund bidder, with officers having due regard to the service outcomes required and the criteria as outlined in 3.2 of the report, balancing the quality of service provision and the cost of the service provision; and 6.3 agree to receive a report back to a future Committee. Denise Kearney Policy Support Officer Office of Chief Executive Tel: 01387 260274 29 May 2002 W4-Rep001 Philip N Jones Chief Executive English Street Dumfries APPENDIX 41 Report Office of the Chief Executive Report

APPENDIX I FUNDING FOR MONEY ADVICE SERVICES GUIDELINES FOR IMPLEMENTATION Introduction 1. These brief guidelines set out the intention with which the Scottish Executive is making additional funds available to local authorities for the provision of money advice. They discuss arrangements for establishing baseline information and the intended outcomes from the additional funds. Background 2. In June 2000 the Minister for Justice, Jim Wallace, established a working group with broad membership to find a workable and human alternative to poinding and warrant sales. This initiative took place against the background of a package of measures already being taken forward by the Scottish Executive to review and reform the law of diligence in Scotland in order to deliver a modem system of debt management and enforcement, and the debate in the Scottish Parliament about the future of poinding and warrant sales. A Member s Bill to abolish poinding and warrant sales had been brought forward early in the Scottish Parliament. The Bill was approved by Parliament in December in 2000, and received Royal Assent on January 2001. As a result poinding and warrant sale will end no later than 31 December 2001. 3. The working group published its report Striking the Balance - a new approach to debt management in July 2001. In the report a central place is given to information and advice to debtors as a means of tackling the persistent problem of debt in our society. Following consultation on the report, the Minister for Justice announced on 19 December 2001 that the Scottish Executive are to invest an additional E3 million each year from 2002-03 to ensure the provision across Scotland of user-friendly advice and information for debtors. 4. The provision of additional money advice services is central to the new approach following from the Working Group s recommendations and it is vital that early progress should be made in developing the additional services. Local authorities are key finders of existing local money advice services through their own provision and support for independent agencies. Allocating funds to local authorities is therefore the best way of ensuring that additional resources compliment exiting provision and that additional services will come on stream as soon as possible. Based on discussions with money advice agencies we estimate that the additional resources will support the full-time equivalent of in total around 75 additional trained money advice workers across Scotland. Allocation of resources 5. It is acknowledged that demand for debt advice services is likely to reflect levels of income poverty. Within the existing grant aided expenditure distribution formula, recipients of Income Support and Job Seekers Allowance are used as a main indicator of deprivation

and low income. The allocation of the &3 million across local authorities is based on DWP data on IS/JSA claimants, and includes a minimum allocation floor of & (&20,000 for the 3 islands authorities) to ensure that -all authorities have sufficient funds to make a noticeable addition to local debt advice services. Aberdeen City Aberdeenshire Angus Argyll & Bute Clackmamanshire* Dumfries & Galloway Dundee City East Ayrshire East Dunbartonshire* East Lothian* East Renfrewshire" Edinburgh, City of Eilean Siar* Falkirk Fife Glasgow City Highland Inverclyde Midlothian* Moray* North Ayrshire North Lanarkshire Orkney Islands* Perth & Kinross Renfrewshire Scottish Borders* Shetland Islands" South Ayrshire South Lanarkshire Stirling* West Dunbartonshire West Lothian Scotland Total IWJSA Claimants (2000) 15599 10792 8364 6959 4553 11614 18991 13449 5430 6020 45 80 35140 3063 13305 27690 106175 1604 1 10593 5445 5448 15820 36253 963 8257 17581 6477 1140 990 1 29477 6130 12691 12719 486660 Allocation per local authority ;E 93,000 65,000 50,000 42,000 70,000 114,000 81,000 210,000 20,000 80,000 166,000 636,000 96,000 63,000 95,000 217,000 20,000 49,000 105,000 20,000 59,000 177,000 76,000 76,000 3,000,000 *Minimum &/&20,000 allocation Baselines and Outcomes 6. Ministers are concerned to ensure that the extra funding is reflected in the development of additional debt advice services, on top of the existing provision. As a condition of allocating these resources through local government we are seeking authorities' assistance in establishing baseline information and a clear indication of the outcomes that the additional funds will deliver. It is not the intention of Ministers that these requirements

should pose a disproportional burden on councils and the guidance in paragraph 12-20 sets out what is expected in this respect. 7. The following expectations apply for councils receiving their allocations fkom the E3million: 0 that they assist in establishing basic baseline information on existing money advice provision in their area; 0 that they indicate, by way of a short paper, how they propose to use the funds to ensure additional provision over the existing provision; 0 that these proposals include specific outcomes that will be achieved, and when; 0 they should show how the additional funding fits in with their own local strategies. Baseline information 8. Baseline information is required on existing provision of money advice in the local authority area currently supported by the council. This covers in-house provision as well as independent (voluntary) organisations. Information is required on the level of fbnding currently provided by the council to support or provide this advice, in order to establish the additionality of future provision. 9. A template for gathering and returning this information is provided in Annex A. This should be returned to Social Inclusion Division no later than 14 June 2002. Plans for use of funds 10. Plans for use of the additional funding should cover the following aspects: 0 How the decision to use the funding in this way was arrived at 0 How the money will be used (including what quality standards will be operated) 0 When additional provision will come on stream 0 Outputs and outcomes expected 11. Plans, or outlines plans covering the above points, should be received by Social Inclusion Division no later than 14 June 2002. These plans are used for information and monitoring purposes are not subject to formal approval by the Scottish Executive. Implementation can therefore start before that date. Annex B gives a plan outline and contact details. Outputs and Outcomes 12. A minimum of one output and one outcome measure (and associated targets) are expected to be included in any proposal: Output: (additional) provisiodstaffing as a result of this funding (by 1 April 2003) Outcome: (additional) debtors assisted as a result of this fbnding (on a monthly, quarterly or annual basis) 13. Monitoring will be against the two key output and outcome indicators given above. Information on progress against the indicators will be collected shortly after April 2003, and again after April 2004. It is not the intention to establish an on-going monitoring burden on local government or the Executive. However, there is a requirement to establish better

information about the availability of money advice services across Scotland and the Executive will consider this in consultation with relevant agencies, once the baseline information is available (see also paragraph 20). Further guidance 14. This further guidance provides more detail on how Ministers intend this additional funding to be used in order to enhance money advice services across Scotland. It is expected that local authorities will give consideration to these points when drawing up their plans. Front line money advice 15. The additional resources are specifically intended to enhance the provision of front line money advice. Money advice is defined by the working group on a replacement for poinding and warrant sales in their report Striking the balance as:,4 series of tools and professional strategies used by advisers to counter the problems encountered by clients in debt, which includes: - a commitment to independent, impartial and high quality advice with financial problems, - a problem solving approach which recognises the respective rights and obligations of the parties to transactions which the client has entered into, - a holistic or whole person attitude to the problems of the individual which takes into account factors such as health, housing conditions etc, - a participation approach involving the individual in solving their problems and learning from experience, - a professional attitude towards those credit companies and agencies, with whom advisers require to negotiate, which recognises the need for consistency and endeavours to build mutual respect. It is expected that advisers have been trained in the specific skills and knowledge required for this area of work. To assist in this the Executive is currently working with money advice agencies to develop plans to increase central support for money advice, training taking priority in this respect. 16. Although in most cases specialist money advice workers will deliver frontline advice themselves, it may be appropriate in some circumstances that specialist money advice workers support others in delivering front line money advice, for example through training and tutoring, or through casework support. Advice providers 17. Local authorities will be able to use the additional resources to enhance their own provision as well as independent sector advice services. In making a decision on how to use the resources allocated to them local authorities should consider whether there currently is a choice for the client in providers of money advice, and in whether there are independent money advice services available in the area. 18. There is an expectation that authorities discuss the use of resources with local money advice agencies in order to establish needs and gaps in current provision. Local authorities may also want to consider the possibility of mainstreaming existing, successful money advice services that are at risk of closure due to short term funding from other sources coming to an

end. Doing so would ensure continuity in service and avoid a loss in valuable expertise and experience. Oualitv Standards 19. The Scottish Executive is aware that at present no uniform standards exist for the training or delivery of money advice to which all networks and providers are agreed. Several advice networks, such as Citizens Advice Scotland, FIAC and Money Advice Scotland, as well as some of the larger authorities have developed their own standards or good practice codes, which are tailored to money advice to different degrees. In the absence of uniform standards it is expected that any additional provision, as well as the existing provision it is part of, will operate under a recognised, established quality system for advice giving. 20. To improve not only the quantity but also the quality of money advice across Scotland the Scottish Executive is currently looking into how to increase the central support for money advice, such as training and information. The development of uniform framework for quality standards in money advice, building on existing systems, will be a key part of this work and we are currently funding Money Advice Scotland to research existing quality of money advice which will help shape this. We are also working toward the development of a common statistical framework which will make it possible to assess the delivery and outcomes of money advice intervention across providers in Scotland. It will be expected from authorities, and from other providers who receive additional resources as a result of the investment of &3million, that they co-operate with such developments. April 2002 Social Inclusion Division

APPENDIX I1 EXPRESSION OF INTEREST TO PROVIDE ADDITIONAL LOCAL MONEY ADVICE IN DUMFRIES AND GALLOWAY 1 GENERAL INFORMATION This is an opportunity for organisations to express an interest providing local money advice in Dumfries and Galloway to develop and manage an additional service, which will address the needs of people with money difficulties. This offer is being made to a number of organisations that are involved in providing money advisory services. This initiative is related to the Scottish Executive s revision of poinding and warrants sales process and is aimed at prevention and providing people with access to money advice at an earlier stage. They define money advice as follows: A series of tools and professional strategies used by advisers to counter the problems encountered by clients in debt, which includes: - a commitment to independent, impartial and high quality advice with financial problems, - a problem solving approach which recognises the respective rights and obligations of the parties to transactions which the client has entered into, - a holistic or whole person attitude to the problems of the individual which takes into account factors such as health, housing conditions etc, - a participation approach involving the individual in solving their problems and learning from experience, - a professional attitude towards those credit companies and agencies, with whom advisers require to negotiate, which recognises the need for consistency and endeavours to build mutual respect. The Scottish Executive has allocated E70,OOO annually to Dumfries and Galloway for the provision of additional money advice linked to this national initiative and specific award. It is the intention of the Dumfries and Galloway Council to initially offer a three-year contract from September 2002 with payment made on an annual basis subject to a performance review and monitoring framework linked to meeting agreed service outcomes. This date may be negotiable for an earlier start but will be no later than 21 October. 2 PROVISION OF SERVICE Organisations are asked to give information on how propose to provide the additional service which should compliment existing regional money advisory service provision, following the guidelines stated below An outline of how many trained money advice workers could be provided for the amount of money available. The money advice workers will provide frontline advice but may support others in delivering front-line money advice through training, tutoring or casework support. Please outline details if the intention is to provide this. Additional service provision could be targeted to areas already identified as experiencing high levels of deprivation i.e. North West Dumfries, Upper Nithsdale and Wigtownshire and / or at local communities experiencing above

0 average levels of poinding and warrant sales. Please outline any proposals for specific additional aredlocal community targeted support. The proposal should include additional costings for the money advice workers and be able to demonstrate best value in terms of balancing best quality of service provision and cost The service must be free at the point of delivery Specific information is required on How people will be advised of the additional service Contact with the client group (by self referral or by a proactive approach) The expected yearly increase in the number of debtors assisted How the information on debtors will be recorded, including a timetable to show how information on progress towards a yearly increase will be available by end of April 2003 0 The organisation s system of monitoring the quality of advice provision Evidence to support the organisation s competence and proven track record in fulfilling this type of contract How the advice workers will be recruited, trained, supervised and managed 3 OTHER RELEVANT INFORMATION The organisation awarded the contract will be expected to assist in any research into quality standards in money advice currently being investigated and developed by the Scottish Executive. In addition to providing written information, agencies may be invited to make a short presentation on their proposals. Through this simple tendering process, the aim is to select a preferred organisation with whom to negotiate the final contract. 5 SUBMISSIONS Expressions of interest should be submitted in writing to Office of the Chief Executive Dumfries and Galloway Council English Street DUMFRIES DG12DD These must be received by Friday 19 July 2002