Not so long ago, all the average school-leaver needed to know about numbers was how to add, subtract, multiply and divide them. Now, however, they have to know about percentages, interest rates, and have the ability to manage debt, to budget and to plan ahead for pensions and other needs.
I concluded, in a report commissioned for Edinburgh University's David Hume Institute and the Stewart Ivory Foundation, that financial education must become an essential, even compulsory, part of teaching.
In summer 2007, these bodies organised a conference attended by educators and financial industry people. Two main sentiments emerged - that the abandonment of O-grade arithmetic had been a mistake, and that financial education had to become a much stronger part of schooling.
The need for financial education is ever more pressing. A 2006 survey by the Financial Services Authority showed that only a fifth of working-age Scots are making financial plans for retirement and more than half prefer to spend what they have now rather than save for the future. The average adult has four credit cards, yet few understand the costs of them. Not surprisingly, unmanageable debts are a fast-growing problem. As a nation, Scots are financially flabby.
Many Scottish schools recognise this and have done fantastic work in devising and using financial teaching materials, so the next generation can avoid these problems. Yet, another FSA survey found that only a fifth of primary schools and half of secondaries were offering regular lessons in financial matters. This is despite Scotland having established a world lead in this area. In 2002, the Scottish Centre for Financial Education was set up in Dundee as part of Learning and Teaching Scotland.
The financial industry has not stayed aloof. It has financed teaching materials and the provision of outside instruction to help schools deliver financial education. This work needs to step up a gear. Under A Curriculum for Excellence, financial education would be delivered through mathematics, social studies, and health and well-being. But, considering the number of leavers who are innumerate and the complaints about this from employers, we have to go further.
The way ahead is for mathematics in the core curriculum to be re-labelled "everyday mathematics", encompassing the old arithmetic syllabus and bringing in statistics as well as financial and enterprise education; it would be examinable at Standard grade and Intermediate levels. The remainder of the syllabus would become an optional subject.
Providing financial education was an SNP manifesto commitment and these proposals have been presented to Fiona Hyslop, Secretary for Education and Lifelong Learning. For the financial fitness of tomorrow's Scots, the health of our society and the wealth-producing capability of the economy, I hope she takes them up.
Financial Fitness Programme for Young Scots. By Peter Jones. Hume Occasional Paper No 72. The David Hume Institute, Edinburgh University. October 2007. www.davidhumeinstitute.com
Peter Jones is a freelance journalist, writing principally for `The Scotsman' and `The Economist'.