Cash in hand
Personal finance has entered the curriculum, and citizenship and PSHE teachers are having to discuss issues such as debt management and mortgages with their pupils. Even younger children are learning about bank accounts and credit cards.
Few teachers claim to be financial experts, so they need expertise and resources. A major government-backed source for such guidance is the Personal Finance Education Group (PFEG), a charity, though some teachers might raise an eyebrow at its list of funders, which includes the Association of Investment Trust Companies, Barclays, Fidelity Investments, and HSBC as well as the Department for Education and Skills. Its advisory group includes the National Consumer Council and Citizens Advice as well as some of the big names of finance.
PFEG's work has acquired added importance in the light of concerns raised by the City watchdog, the Financial Services Authority, about "financial illiteracy" among adults. The FSA says this is a national problem that has been highlighted by the pensions and mortgage misselling crisis.
PFEG's chief executive, Wendy van den Hende, says: "Life today is much more complicated than it used to be and young people need to use a greater range of skills at an earlier age.
"They have to cope with financing themselves through university, they may retrain several times as their employment changes, they will live longer, are more likely to experience relationship breakdown and are exposed to a vast range of financial products - all at a time when state provision is reducing.
"We take care to ensure that any involvement from the finance sector is not about selling its products. All resources have to meet strict criteria; the activities must be linked to the curriculum and tested by teachers.
"PFEG believes financial capability is much broader than distinguishing between products. It includes financial acumen, financial responsibility, financial confidence, elements of enterprise and young people identifying their approach to risk and uncertainty."
The "financial capability through personal finance" curriculum has been put together by the DfES in consultation with PFEG. It runs through all key stages, but there are no plans to make it statutory. At key stage 1, personal finance teaches such issues as where money comes from and where it goes; at key stage 2 it covers cash and "non-cash" as well as the basics of tax; key stage 3 introduces budgeting, credit cards and the concept of risk and return; key stage 4 includes debt, government finance and taxation, national insurance and pensions.
PFEG is giving advice to 400 schools until 2004 in a project called Excellence and Access to help teachers to become confident in teaching personal finance. It is also spreading the word among trainees: later this month, a PFEG member, Margaret Atherton, will coach a class of PGCE students at Surrey University.
After a year, a survey of 72 teachers in the Excellence and Access project found two-thirds felt confident in their ability to teach personal budgeting and methods of payment. One-third were confident on exchange rates and financial institutions. Less than a third were confident on taxation.
Financial education at Laisterdyke high school in Bradford, which is hoping to become a business and enterprise college in September, has evolved under the pilot scheme into a practical subject answering pupil need, says Lynne Harrison, assistant headteacher with responsibility for the PSHEcitizenship curriculum. "We're in the city's second most multi-deprived ward. More than 80 per cent of our students are from non-UK ethnic backgrounds and from homes where English is not the first language; and 41 per cent of students are eligible for free school meals," she says.
"We were keen to become involved because we were convinced that financial capability is a skill all our pupils need and many do not have. We needed to tackle this element within the curriculum and the offer of support was too good an opportunity to miss.
"Working with our school adviser, we developed a module for some Year 11 students who are low-attainers and for some of the time are following an alternative curriculum. The module has potential, with modification, for other tutor groups within school."
Andrew Flatt, mathematics co-ordinator at Whitstable junior school in Kent, is positive too. "If lessons are fun, interesting and relevant, primary schools can provide an important foundation that can be developed at key stages 3 and 4.
"At key stage 1, children in my school have been introduced to personal finance through the existing numeracy curriculum with activities such as a play shop, identifying coins and their value, and a pocket money survey. At key stage 2, my Year 6 class focused on pocket money and spending habits.
We talked about where their money came from, the need to save, and the concept of earning."
The message is: get them young, keep them solvent. Financial literacy hour, anyone?
PFEG: 020 7220 1735; www.pfeg.org