The free debt advice service offered by the government is unable to cope with the 28% rise in queries from people struggling with debt problems, a new survey has shown.
The recession has seen the number of people seeking debt advice soar in recent months, and research has suggested that one in ten people are having problems with payments on their loans and credit cards.
The report was issued by tthe Public Accounts Committee who said that, with a number of different projects and funding streams running simultaneously, the Department for Business, Innovation and Skills' approach to free advice was "unnecessarily complex".
Opposition MP’s have criticised the government’s approach to those in debt calling it a "triumph of bureaucracy over practicality" with people waiting up to a month for debt advice and some even being turned away.
Debt advice charities have denied that they are unable to cope with the rise in demand and have said that demands for charities to turn away from face-to-face meetings to provide telephone and web-based advice was out of date due to the increase in government funding.
According to the National Audit Office (NAO) report it costs an average of £265 to provide face-to-face debt advice whereas telephone advice costs £51 and internet services are even cheaper.
But consumer Minister Kevin Brennan said: “It is crucial that when people are struggling with debt, they seek help as soon as possible. The Government will not hold back from helping those most in need through these tough economic times.”
The NAO has called for the government to make the scheme more efficient after agreeing that the demand is greater than the services offered.
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