Calls for public sector to adopt Standard Financial Statement

After the SFS was launched, a campaign is underway to put pressure on the public sector to embed the statement in its collections practices.

Calls for public sector to adopt Standard Financial Statement

The Money Advice Service (MAS) has now launched the SFS – a statement designed to bring greater consistency to the way organisations assess people’s finances when they are in debt.

It will be adopted by all major debt advice providers across commercial and not-for-profit sectors, including Citizens Advice, Money Advice Trust and StepChange Debt Charity. The Insolvency Service will start using the new format this month, while creditors have also started building the SFS into their collections practices.

While many companies in the private sector adopt the statement, there is now a growing number of calls for more public sector entities to do the same.

Joanna Elson, chief executive of the Money Advice Trust, the charity that runs National Debtline, hopes more organisations will now sign up to use the SFS, including local authorities, government departments and other public sector creditors.

Organisations that sign up to the SFS will agree to a code of conduct to ensure best practice usage, which will not only ensure that people’s affordability assessments are more consistent, but will enable smoother transfer of information between the organisations working with them.

More than 22 organisations pulled together to agree on the format for recording income, expenditure and arrears as well as agreeing a set of spending guidelines.

The statement will also include a savings category to help encourage people build financial resilience while they deal with their problem debt.  

MAS said that debt advice provider Payplan, one of the first agencies to start using the SFS, will itself help more than 100,000 people each year by using the statement.