Financial education in schools
30. It was widely noted in evidence that schools
had an important role to play in improving the financial capability
of young people. The Personal Finance Education Group (PFEG) told
Schools are unique in having access to, and influence
on, all young people across social, economic, ethnic and religious
groups. If we can ensure that young people leave school as informed
and independent consumers with the confidence to engage with the
finance sector, this will provide a firm foundation and prevent
many of them from getting into financial difficulties as adults.
31. However they believed that "currently, personal
finance education, if it happens at all, has a low status. It
cannot be assumed to be happening in any given school at any time."
Professor Kempson told us that there was much more that needed
to be done to promote financial education through schools and
that "at present the situation regarding its place in the
school curriculum varies across the four countries of the UK
and the work of [PFEG] and others has shown that provision is
patchy, with most teachers lacking the skills and confidence to
teach the subject".
32. The FSA has recently undertaken a benchmark
study on the existing provision of financial education within
schools. This found that, while 48% of primary schools and 91%
of secondary schools were delivering some form of personal financial
education, in over 70% of cases it was in the form of occasional
lessons, usually happening once or twice a term or less.
Only about half of schools in England had drawn on guidance from
the Department for Education and Skills (DFES), but over two-thirds
of schools in Scotland reported that they had drawn on guidance
provided by Learning and Teaching Scotland. Only a minority of
schools had received training in this area (9% of primary schools
and 26% of secondary schools), but slightly more had received
some other form of support (11% of primary and 40% of secondary
schools). The proportion of schools which had received support
was higher in Scotland than in England and Wales.
The Scottish Executive has supported the development of the Scottish
Centre for Financial Education established by Learning and Teaching
Scotland. The Welsh Assembly Government told us that they intended
to emulate this approach in Wales and were working with the FSA
and private sector investors to examine options for the establishment
and funding of such a centre.
33. DFES told us that, as part of the reforms to
education for the 14-19 age group
financial capability education will be taught more
explicitly in the curriculum by including it in the new functional
mathematics component of GCSE mathematics. But we also recognise
that a range of other subjects, such as Personal, Social and Health
Education, Citizenship, Business Studies and Careers Education,
offer good opportunities and contexts for exploring and improving
young people's understanding of financial issues.
34. The Ifs school of Finance, a registered
charity which provides financial education, has indicated concern
that the Standards for Functional Mathematics published by the
Qualifications and Curriculum Authority were inadequate. The Ifs
school of Finance told us that the only reference to 'finance'
of any type appears in just the two lowest levels and that there
was no mention of anything to do with finance in Entry level 3
or in Levels 1 and 2 (GCSE level). They feared that "the
concentration is on mathematical concepts such as arithmetic and
basic geometry. What is being masqueraded as financial capability
is confined to recognising notes and coins and simple calculations
Moreover, they noted that "naming the course 'mathematics'
immediately alienates students who have a fear or dislike of the
35. PFEG told us that while "it is relatively
easy to attract funding for modest projects that are discrete,
branded and time-limited, it has proved difficulty to acquire
the necessary funding to achieve the step change identified by
the FSA's national strategy". They noted that "Government
departments have indicated that [the additional funding for financial
capability projects] is unlikely to come through the Department
for Education and Skills".
36. Providing financial education in schools is
an essential part of the FSA's National Strategy for Financial
Capability. We welcome the change to address financial capability
more explicitly in the 14-19 curriculum in England by including
it in the new functional mathematics element of GCSE mathematics,
although we are concerned that the content of this element will
not be sufficiently focused on financial education. In over 70%
of schools, personal finance education is only provided in the
form of occasional lessons happening once or twice a term or less.
It should be a priority for the Department for Education and Skills
to ensure that the Qualifications and Curriculum Authority and
those responsible for delivering the school curriculum see financial
education as a core issue. Improving financial education in schools
needs to be a major objective of the Government's ten-year strategy
for improving financial capability.