By Matthew Barrett
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In Parliament on Thursday, the Member for North Swindon, Justin Tomlinson, introduced a motion to promote financial education in schools. The text of the motion was:
"That this House notes that young people today grow up in an increasingly complex financial world requiring them to make difficult decisions for the future, often without the necessary level of financial literacy; believes that financial education will help address the national problem of irresponsible borrowing and personal insolvency and that teaching people about budgeting and personal finance will help equip the workforce with the necessary skills to succeed in business and drive forward economic growth; further believes that the country has a duty to equip its young people properly through education to make informed financial decisions; and calls on the Government to consider the provision of financial education as part of the current curriculum review."
Mr Tomlinson stated one of his reasons for supporting financial education for schools:
"[M]y generation could be pretty rubbish at handling money. We could go to university, drum up huge amounts of debt, including expensive debt on credit cards, and then secure our first graduate jobs—in my time that was relatively easy to do—get on to the housing ladder with a 100% or 100%-plus mortgage and watch house prices increase. … we could reconsolidate our mortgage, pay off all our expensive debts and carry on, but that option will not be available to the next generation. … it is very difficult to get into the housing market … It is harder for young people to get credit and harder for people to correct any mistakes they may have made."
Andrew Percy, the Member for Brigg and Goole, and a member of the All-Party Group on financial education for young people, explained his motivation for supporting the motion:
"It has been a good partnership with my hon. Friend the Member for North Swindon because he is extremely financially competent, as anyone who knows him will know. Having shared a flat with him, along with another of our hon. Friends, I can certainly attest to his competency in all things financial… I am the antithesis of that, having made some incredibly bad financial decisions when I left school and went to university, including getting on the conveyor belt of credit card debt while at university and getting student loans even though that was the year before tuition fees came in. So I left university with an awful lot of debt and then did two years of postgraduate study, which I funded myself, which meant getting into even more debt. I am still paying off those debts today"
Mr Percy, who was a teacher until the last general election, used his experience to explain why financial education – currently a part of the "PSHE" subject – is not always properly taught:
"For three years, I taught in a very difficult school in Hull, in one of the most deprived catchments in the country. I had to deliver PSHE, but we had so many other pressures on us to raise standards, such as working with grade C-D borderline kids so that in the next year’s league tables we would do a little better and would not be picked out by the local media as the worst-performing school. In better-performing—dare I say it?—more middle-class schools, teachers may be able to indulge themselves a little more in developing the PSHE curriculum because they do not have quite the same pressures on them. However, I am afraid that in a lot of schools, despite the professionalism of teachers, the subject often takes a back seat."
The Minister of State for Schools, Nick Gibb, gave the Government's response to the motion. He set out how the Government is helping to implement the teaching of financial education:
"The Government are currently conducting two reviews—that of the national curriculum, which of course includes the core subject of mathematics, which is a cause about which my hon. Friend the Member for South West Norfolk (Elizabeth Truss) is passionate, and that of personal, social, health and economic education, which includes financial capability. The all-party group’s report provides important insights and recommendations to both reviews, and the Government are grateful to it for its thorough and high-quality report. We will examine it very carefully indeed."
Minister Gibb went on to criticise the materialistic culture which is partially to blame for trapping people in debt:
"It is true that young people are growing up in a materialistic world for which they are often not fully prepared. … young people have high aspirations for branded or designer goods, often without the means to pay for them. They have unrealistic expectations about the lifestyle that they can afford, which are fuelled by the glittering trappings of celebrity. … We all have a job to do in moving young people’s aspirations away from that empty and often destructive perception of what success means. Our determination to raise academic standards in all schools and for all young people, regardless of their background, is about high achievement and stretching aspirations. Developing children’s intellectual capabilities and interests is a direct antidote to materialism."
The end result of the debate was that the motion listed at the top of this post was agreed to.
The full debate can be read on Hansard here.