The announcement was made by the Department for Business, Innovation and Skills and it means the commitment will replace the Financial Inclusion Fund (FIF), which had provided vital support to the Citizens Advice Bureaux.
Citizens Advice chief executive Gillian Guy said: “Our FIF-funded specialist money advisers have helped more than 77,000 people with debt problems over the last year, so this is good for our clients, many of whom come from the most vulnerable, financially excluded groups who are difficult to reach through other non-faceto face means.”
Guy claimed that the extension of funding was a clear recognition that the project was “providing excellent value for money.”
During the last five years, Citizens Advice has invested £87m through FIF in advising clients with a combined total debt of about £1.2bn.
Guy added: "This announcement will, of course, be highly welcomed by the debt advisers themselves, who were facing redundancy, and who can now continue to help their clients with their money problems.
“Of course, local Citizens Advice Bureaux will also be buoyed by this announcement; many were having to plan not only for the end of the FIF, but also for likely cuts in their core funding from local authorities and Legal Aid funding from the Ministry of Justice.
Delroy Corinaldi, external affairs director at the Consumer Credit Counselling Service, said: “We welcome the reprieve for the FIF as it helps deal with current uncertainties over the availability of face-to-face debt advice, although we are concerned that any reduction in the amount should not impact on peoples' ability to get free face to face debt advice.
“This should put free advice in a place where it can continue to take on the fee-charging sector which the recent Office of Fair Trading review found to be unfit for purpose.”
He added: "The challenge now is for debt charities to work together to provide free debt advice, face-to-face, over the phone and online, for those who need it."