The UK government is launching a two year pilot project that will provide free, basic financial advice to those that can’t afford commercial advice.

The new scheme is the main recommendation of the Thoresen Review, which was also published today. Last year the government asked Otto Thoresen, chief executive of insurer AEGON UK, to look at the provision of financial guidance in the UK.

His report finds that many people could benefit from help on money matters. Among other things, it recommends that a national service should be governed by the principles of impartiality, supportiveness, crisis prevention, universality; and, that it should provide information, but not sales.

Thoresen found that the commercial financial advice market finds it difficult to serve the needs of many ordinary consumers, particularly those on average or lower incomes. He has set out a system to provide this advice through a variety of channels — the internet, over the phone, and with face-to-face advice — and is delivered in partnership with a range of organisations.

Under the new scheme, announced by Yvette Cooper, chief secretary to the UK Treasury, up to 750,000 people will get free guidance on topics such as managing debt, planning for retirement, or saving for a mortgage deposit.

“It could be working out credit card repayments, budgeting for a new baby, or planning for retirement – people have to make serious financial decisions at every stage of their lives. Getting some free, independent and trusted guidance can make all the difference and can help families manage their budget and get a better return on their savings,” Cooper said in a release. “It could also help prevent people getting ripped off by loan sharks or caught out by the small print on a dodgy financial deal.”

The so-called Money Guidance Pathfinder will be delivered by the single financial regulator in the UK, the Financial Services Authority, and it will be funded jointly by the government and the FSA. The pilot program will last for up to two years to establish how a national money guidance service could be delivered.