Photo of child with books and a large calculator

Table of contents

On 31 January 2024, the House of Lords is scheduled to consider the following question for short debate:

Baroness Sater to ask His Majesty’s government what steps they are taking to improve the financial literacy of children through the provision of financial education in schools.

1.   Financial education and the curriculum

Education in the UK is a devolved matter. This means each UK nation has different curriculum requirements for financial education, as set out below:[1]

  • England: Financial education is included in the national curriculum for secondary schools only. This forms part of citizenship and maths. It requires that pupils should be taught about various things including budgeting, credit and debt, insurance, savings and pensions. Whilst primary schools are not legally required to offer financial education teaching, the maths curriculum does include some learning about money. All schools are also expected to deliver PSHE lessons which include some financial education.
  • Wales: A new curriculum began roll-out in 2022 across primary and secondary schools. It includes elements of financial education in subjects such as maths and health and wellbeing.
  • Scotland: Financial capability is included in the broad general education phase curriculum for pupils aged 3 to 14 years, mainly in maths and numeracy.
  • Northern Ireland: Financial capability is included in the national curriculum for pupils aged 4 to 14, primarily through maths and numeracy.

Despite these requirements, an inquiry by the All Party Parliamentary Group on Financial Education for Young People found that confusion existed amongst some teachers about whether schools were required to deliver financial education.[2] Findings from the APPG’s survey of 401 teachers from UK primary and secondary schools in 2022 found that over two-fifths of secondary school teachers surveyed did not know that financial education was a curriculum requirement.[3]

The state of financial education in UK secondary schools was assessed in a 2023 research study by Compare the Market and financial education charity MyBnk.[4] The researchers reported a positive association between financial education and financial literacy.[5] Approximately 4,000 young adults and 645 teachers were surveyed between February and March 2023 as part of the research. Findings included:

  • Two in five (41%) of young adult respondents were considered financially literate according to Compare the Market and MyBnk’s financial education measure.[6]
  • Almost two-thirds (61%) of young adult respondents did not recall receiving financial education at school.[7]
  • Those who received financial education lessons were taught for an estimated 48 minutes per month on average.[8]
  • An estimated 30 hours of financial education for 11- to 18-year-olds was calculated to be the minimum amount needed for most young adults to be financially literate.[9]

The researchers concluded that financial education was not being adequately provided in UK schools.[10] They said the quantity of financial education lessons was a key issue behind the lack of financial literacy in young adults.[11] However, the researchers also acknowledged current demands on secondary school teachers’ time, as well as a lack of financial education teaching expertise in some cases. To address this, the report said external resources such as financial education charities could be used to supplement in-school financial education. The researchers also highlighted that financial education should not be limited to the classroom. The report emphasised the role of parents, businesses and the wider community in supporting the financial literacy of young people.

2.   Research studies on the impact of financial education on financial literacy

Several research studies have considered the impact of financial education on financial literacy.

According to survey results by the Money and Pensions Service (MaPS), children’s attitudes about money have been shown to have developed by the age of seven.[12] Published in 2023, results from the UK children and young people’s financial wellbeing survey 2022 showed that 47% of children and young people surveyed had received a “meaningful financial education” in 2022, compared to 48% in 2019.[13] MaPS said 33% of respondents recalled learning about money in school and finding it useful. Additionally, 24% of respondents recalled receiving financial education at home. However, only 10% of respondents were reported as having both. According to MaPS, these findings showed that respondents tended to receive meaningful financial education either at school or at home, but not as a joined-up financial education. MaPS also said children who received a joined-up financial education were more likely to demonstrate higher levels of good day-to-day money management, compared to those who did not. In addition, MaPS said children who received a meaningful financial education were more likely to have positive attitudes towards money and possess better money management skills.

According to MaPS, understanding “what works” in building children and young people’s financial capabilities was key to delivering effective financial education.[14] A MaPS evidence review published in September 2023 explored key themes that had been shown to build financial capability amongst children and young people, including:[15]

  • Workshops and classroom formats which they said could enhance ability and mindset.
  • Parental involvement which they said appeared likely to influence children and young people’s mindset, connection and behaviour.
  • Interventions at a young age which they said were likely to positively enhance financial capability.

3.   Calls for further support for financial education

Some external organisations and parliamentarians have called for more to be done to support financial education in schools.

For example, UK think tank the Centre for Social Justice (CSJ) has called for an “urgent rethink” of financial education.[16] Highlighting the importance of financial literacy, the CSJ referred to evidence which it said had shown people with higher financial literacy were more likely to absorb unexpected income shocks and save for the future, and were less likely to find themselves in unsustainable debt. Emphasising the importance of school-aged financial learning, the CSJ called on the government to undertake various reforms. As a minimum, it recommended the Department for Education should place financial education on the national curriculum for primary schools within PSHE (or equivalent).[17] Additionally, the CSJ recommended that the government should require all schools to ensure pupils received ‘experiential’ financial education at least three times between year 8 and year 13.[18]

The importance of financial literacy has also been recently evaluated by the House of Commons Education Committee. In April 2023, the committee noted the importance of young people leaving education equipped with skills in financial literacy.[19] The committee said the government should consider how focused qualifications in financial skills and practical numeracy could be used to broaden the reach of the ‘maths to 18’ initiative. Further information on the government’s ‘maths to 18’ programme is provided in section 4 of this article.

The education committee has followed this up by launching a dedicated inquiry into financial education in England in November 2023.[20] The purpose of this inquiry is to consider the current state of financial education and to determine what steps are needed to improve delivery. The committee said it planned to explore: what young people should be taught about money, where financial education should sit within the curriculum, and whether the provision of financial education should be extended to primary schools and post-16 education. The committee ran a call for evidence as part of this inquiry which closed on 22 December 2023 and is due to start holding oral evidence sessions on 30 January 2024.

4.   What the UK government has said

The Minister for Schools Nick Gibb has recently described having “good maths” as the gateway to lifelong financial stability.[21] During a House of Commons Westminster Hall debate, the minster highlighted that financial knowledge already formed a compulsory part of the national curriculum for maths at key stages 1 to 4 and citizenship at key stages 3 and 4.[22] He said rooting financial education in these subjects would ensure the curriculum remained focused on the knowledge pupils needed to manage their money with confidence.[23]

The minister also highlighted various programmes aimed at improving maths tuition in schools, including maths hubs. Launched in 2014 and coordinated by National Centre for Excellence in the Teaching of Mathematics (NCETM), the national network of maths hubs sees schools, colleagues and other organisations work together to improve maths education.[24] This collaboration takes various forms, including project work, face-to-face CPD (continuing professional development) sessions and online support. As of January 2024, there were 40 maths hubs in England.[25] During the House of Commons debate, the schools minister described how maths hubs were supporting schools to improve their maths teaching, including financial content.[26]

In addition, the minister said the government aimed to improve financial capability through the ‘maths to 18’ programme.[27] Prime Minister Rishi Sunak first referred to this programme in January 2023 when he announced that all children and young people would study maths in some form until the age of 18.[28] In April 2023, the prime minister said a new advisory group would be set up to advise on the maths to 18 programme.[29] Then, in October 2023, the government announced a new advanced British standard qualification for 16 to 19 year olds.[30] This new baccalaureate-style qualification would include provisions to ensure every student studied maths to the age of 18 years.[31] It is expected to take a decade to implement the advanced British standard in full, according to the Department for Education.[32] The government said its next steps were to undertake a consultation on the design and approach of the new qualification.[33] Findings from the consultation would then inform a white paper to be published during 2024.

On financial education specifically, the minister highlighted the MaPS ‘UK strategy for financial wellbeing’.[34] This strategy includes a national goal to see 2 million more children and young people (6.8 million) getting a meaningful financial education by 2030 when compared to 2020 figures (4.8 million children). MaPS said this goal could be achieved through several mechanisms, including more investment in effective interventions.[35] Referring to the results of the 2022 MaPS’ children and young people’s financial wellbeing survey, the minister said progress made towards the national goal had remained static since 2019.[36] Mr Gibbs highlighted that MaPS has a statutory duty to co-ordinate the work of organisations to deliver that goal.

The schools minister also spoke about the importance of teachers in delivering financial education. He said the Department for Education had been undertaking work to support the recruitment and retention of teachers across all curriculum subjects.[37] This included a financial incentive package worth up to £181mn to attract people into teaching. Additionally, Mr Gibb said the MaPS was investing over £1mn through a grant programme for projects that included testing approaches to embed and scale teacher training in financial education.[38] He said these projects were due to run until March 2024 and the findings published later that year.

Most recently, the government has said the Oak National Academy is providing free curriculum materials, including for maths, to help schools provide high quality curriculum.[39] Minister of State for Education Robert Halfon said the materials would be available from Autumn 2023, with the full curriculum packages available by summer 2024.

5.   External schemes to improve financial literacy

Various financial organisations and charities have published free resources and hosted schemes aimed at improving financial literacy amongst young people. For example, MaPS published a ‘Talk money week toolkit for schools’ as part of the annual ‘talk money week’. This included resources to help schools promote the financial wellbeing of their pupils.

The Centre for Financial Capability (TCFC) provides funding for financial education lessons in primary schools via its kickstart money programme.[40] The TCFC is a coalition of savings and investment firms that provides funding to support financial education in children. The purpose of the kickstart money programme is to set positive money habits and mindsets in children from an early age. Schools can access free lessons led by experts from financial charity MyBnk, as well as resources for teachers and carers. To complement the in-schools programme, the TCFC also provides funding for MyBnk to deliver free online financial education programmes for children at home. MyBnk has said it provides a range of expert-led financial education workshops in schools and youth organisations for those aged 5 to 25 years.[41] These workshops provide students with information on a variety of topics, including budgeting, banking, borrowing, student finance, tax and pensions. MyBnk advertises many of its programmes as being free or fully funded.

Additionally, the Financial Times established the ‘Financial literacy and inclusion campaign’ in 2021. It said the aim of this charity was to “democratise financial education” by offering free content to those who need it most, including young people.[42]

6.   Read more

Cover image from freepik.com.

References

  1. Money and Pensions Service, ‘Financial education in schools’, accessed 22 January 2024. Return to text
  2. All Party Parliamentary Group on Financial Education for Young People, ‘Building beyond barriers: A roadmap for enhancing financial education in schools’, February 2023. Return to text
  3. As above, p 23. Return to text
  4. Compare the Market and MyBnk, ‘Financial education in secondary schools in the UK’, May 2023. Return to text
  5. As above, p 55. Return to text
  6. As above, p 5. The financial education measure was developed by combining financial literacy questions from the Standard and Poor’s Ratings Services Global Financial Literacy Survey with additional questions based on insights from Compare the Market and MyBnk. Young adults were then presented with these questions. CEBR (Centre for Economics and Business Research) then assessed their financial literacy level based on their responses. Return to text
  7. As above, p 16. Return to text
  8. As above, p 18. Return to text
  9. As above, p 5. Return to text
  10. As above, p 59. Return to text
  11. As above, p 6. Return to text
  12. Money and Pensions Service, ‘Financial education in schools’, accessed 18 January 2024. MaPS is an arm’s length body sponsored by the Department for Work and Pensions. Return to text
  13. Money and Pensions Service, ‘UK children and young people’s financial wellbeing survey: Financial foundations’, 14 June 2023. The measure of a “meaningful financial education” is based on the percentage of respondents who said they “recalled receiving financial education at school that they considered useful” and/or “received regular money from parents or work, and their parents set rules about money and gave them responsibility for some spending decisions”. Respondents who said yes to either or both statements were considered to have received a meaningful financial education for the purpose of the survey. Return to text
  14. Money and Pensions Service, ‘Developing children and young people’s financial capability: Evidence review’, 26 September 2023. Return to text
  15. As above, p 5. Return to text
  16. Centre for Social Justice, ‘On the money: A roadmap for lifelong financial learning’, June 2022, p 8. Return to text
  17. As above, p 8. Return to text
  18. As above, p 9. Return to text
  19. House of Commons Education Committee, ‘The future of post-16 qualifications’, 28 April 2023, HC 55 of session 2022–23, p 46. Return to text
  20. House of Commons Education Committee, ‘Financial education: Inquiry’, accessed 19 January 2024. Return to text
  21. HC Hansard, 6 September 2023, col 143WH. Return to text
  22. HC Hansard, 6 September 2023, col 144WH. Return to text
  23. HC Hansard, 6 September 2023, col 146WH. Return to text
  24. National Centre for Excellence in the Teaching of Mathematics, ‘About maths hubs’, accessed 18 January 2024. Return to text
  25. National Centre for Excellence in the Teaching of Mathematics, ‘Find your hub’, accessed 18 January 2024. Return to text
  26. HC Hansard, 6 September 2023, col 144WH. Return to text
  27. HC Hansard, 6 September 2023, col 146WH. Return to text
  28. Prime Minister’s Office, ‘PM speech on building a better future’, 4 January 2023. Return to text
  29. Prime Minister’s Office, ‘Prime Minister outlines his vision for maths to 18’, 17 April 2023. Return to text
  30. Department for Education, ‘A world-class education system: The advanced British standard’, 4 October 2023. Return to text
  31. As above, p 32. Return to text
  32. As above, p 7. Return to text
  33. As above, p 39. Return to text
  34. HC Hansard, 6 September 2023, col 145WH. Return to text
  35. Money and Pensions Service, ‘UK strategy for financial wellbeing’, 2020, p 17. Return to text
  36. HC Hansard, 6 September 2023, col 145WH. Return to text
  37. HC Hansard, 6 September 2023, cols 145–6WH. Return to text
  38. HC Hansard, 6 September 2023, col 146WH. Return to text
  39. House of Commons, ‘Written question: Financial services: Curriculum (405)’, 7 November 2023. Oak National Academy is an arm’s length body sponsored by the Department for Education that provides free curriculum resources to schools. Return to text
  40. Centre for Financial Capability, ‘About us’, accessed 19 January 2024. Return to text
  41. MyBnk, ‘Our work’, accessed 19 January 2024. Return to text
  42. Financial Times (£), ‘Financial literacy and inclusion campaign’, accessed 22 January 2024. Return to text