Only 1% of primary teachers think their students have adequate financial skills

In a report out today, with a foreword from former education secretary David Blunkett, the Social Market Foundation – a cross-party think tank – sets out a roadmap towards effectively integrating financial education into the primary school curriculum, and lays out the distance we need to travel in order to get there. Drawing on a nationally representative survey of  school teachers (see notes for survey breakdown), sponsored by Santander UK, the SMF found that only 1% of primary school teachers believe that their students’ level of financial literacy is adequate.

Those numbers should give pause to policymakers, who are increasingly keen on ensuring that young people’s education should set them up with necessary life skills like financial capabilities. The shadow education secretary, Bridget Phillipson, used her Labour Party conference speech to promise that in government she would ensure the maths curriculum has more ‘real world’ relevance, with financial education at the heart of it. The House of Commons education committee, whose chair Robin Walker will launch the report at an event in parliament later today, is carrying out an ongoing inquiry into the state of financial education.

In his foreword, Lord Blunkett, former education and employment secretary and Vice-Chair of the APPG for Financial Education for Young People, says that “By placing financial education more prominently in the primary school curriculum… we can ensure that we are setting up our children for a successful future.”

At present, financial education is only compulsory at the secondary school level in England, and as a result young people from more advantaged backgrounds are more likely to have received some form of financial education.

Given these large socioeconomic differences in young people’s financial literacy, and the fact these gaps appear by age 11, it is imperative for financial education to be introduced earlier to children – and for provision to be high-quality and universal, the SMF said. Internationally, countries that have high financial literacy scores tend to include financial education in the primary curriculum in some format, the SMF pointed out.

Yet there remain concerns over the effectiveness of existing financial education where it is part of the curriculum – in English secondaries and across primaries and secondaries in other UK nations.

The SMF’s survey revealed a number of obstacles to successfully integrate financial education into the primary curriculum in England. 81% of primary school teachers cited a lack of time as the biggest barrier to giving students a strong foundation in financial literacy. This was followed by a lack of resources (43%), low prioritisation (42%), and lack of expertise (37%).

The SMF suggest that the assumption financial education must take place within maths represents a major potential pitfall for the policy. In fact, 66% of teachers wanted financial education to be integrated into personal, social and health education (PSHE), and 41% said it should be across multiple subjects.

More generally, the SMF’s pathway to ensuring effective financial education in primary schools includes:

1. Making financial education a statutory part of the English primary school curriculum
2. Doing this through a ‘whole school approach’, as pursued in Finland and New Zealand, which allows financial literacy to be embedded in multiple subjects.
3. The Department for Education (DfE) funding and developing a digital central hub of quality assured training programmes and classroom resources for teachers.
   1. This could be funded through the Dormant Assets Scheme, of which £87.5 million has already been allocated to support individuals in managing their finances
4. Integrate financial education into Initial Teacher Training
5. DfE and Ofsted should signal their commitment to prioritising financial education, setting financial literacy as a priority area. The Money and Pensions Service should work with the Department for Education to calculate the long-term funding, provided by the Dormant Assets Scheme, required to provide effective financial education at primary level in England.
6. The government should support the Money and Pension Advice Service to develop a financial literacy data strategy, involving greater support for academic studies, inclusion of financial literacy questioning in British cohort studies, and participating in future iterations OECD’s PISA financial literacy study.

Dani Payne, Senior Researcher at Social Market Foundation, said:

“Having a financially literate population is an important part of a healthy and prosperous country. Financial literacy has documented links to better physical and mental health, supports accumulation of wealth, and may also reduce the likelihood of people falling victim to fraud and being in debt. Unfortunately, the UK currently has low levels of financial literacy compared to other developed countries, and levels of financial understanding tend to track existing socioeconomic inequalities.

A universal financial education is critical to ensure that all people are equipped to make healthy financial decisions and to support social mobility. So far, disparate approaches across education levels and between nations has limited progress in this area. The inclusion in the English primary curriculum, alongside greater support for teachers and funding for schools at both primary and secondary level, will be an important step forwards in preparing our children for success in adulthood.”

Lord Blunkett, former education secretary and Vice Chair of the APPG on Financial Education, said:

“This report is a timely and much-needed analysis of what is currently going wrong with financial education in the UK, and the barriers schools and teachers face in improving and universalising current provision. It concludes with a clear roadmap.

By placing financial education more prominently in the primary school curriculum, and committing to appropriate investment in teacher training and support and funding for schools’ provision, we can ensure that we are setting up our children for a successful future. Beyond its target focus of English primary schools, the report offers insights into what can be done to improve provision in secondary schools.”

Mike Regnier, Santander UK CEO, said:

“We are proud to be launching this report today in partnership with the Social Market Foundation, providing new insight into and recommendations on the importance and practical delivery of financial education. There is strong evidence of the need for better financial education, and it’s clear that while progress has been made in the UK, there is still more to be done.

“As outlined in the SMF’s report, teachers need access to quality training and resources in order to become confident and skilled in the teaching of financial education in the classroom. That’s why we’ve worked with Twinkl to create an easy-to-use, helpful tool designed to inspire, empower, and equip teachers with a go-to framework for teaching financial education.”

Notes

1. The SMF report, Investing in the future, will be published at https://www.smf.co.uk/publications/investing-in-the-future/ on Tuesday 16th April, 2024.
2. Survey conducted by Teacher Tapp in November 2023, polling a nationally representative sample of 9,662 school teachers in England.
   • To the question about adequate financial literacy levels, 2,619 primary school teachers responded.
   • To the question about barriers to integrating financial education, 3,207 primary school teachers responded.
   • To the question about where financial education should be in the curriculum, 6,996 teachers responded.
   • See here for full breakdown for questions and responses: SMF – TeacherTapp Survey Breakdown
3. The report is sponsored by Santander UK. The SMF retains full editorial independence.

Contact

• For media enquiries, please contact Impact Officer Richa Kapoor at richa@smf.co.uk

ENDS