84% of young people get no financial education. That's not the real problem

Financial advisers need it more.

The Chartered Institute for Securities and Investment (CISI) said yesterday that it supported a private member's bill introduced by Thomas Docherty MP to include financial literacy in the national curriculum.

A study in July found that 84 per cent of young people aged 18-25 hadn't received any formal financial education. But it would be interesting to find out how formal financial education affects decision-making: if young people understand basic financial concepts, from inflation and interest rates, to stocks and shares, or how banks operate, will they be less likely to take out payday loans, max out their credit cards or take out unaffordable mortgages? 

You could easily argue that financial training didn't prevent bankers from excessive risk taking. Then again, until this year, financial advisers weren't required to hold more than the equivalent of an A-level in finance.

I remember once speaking to Christopher Jones-Warner, who teaches communication to wealth managers. He said that at his training sessions for financial services personnel he asks attendees to raise their hands if they"have a financial plan" are "working that financial plan" and therefore "expect to retire comfortably." He estimates only around 22 per cent of his audience raise their hands. If professionals aren't planning their finances sensibly, what hope is there for the rest of us?

This makes me wonder, perhaps the problem isn't one of formal financial education, but something more informal and more difficult to teach in a classroom— a question of ethos. It seems to me that it's more important that people are less reckless when it comes to taking on debt, than that they can tell an examiner what a derivative is.

This article first appear on Spear's.

Drive for financial literacy. Photograph: Getty Images

Sophie McBain is a freelance writer based in Cairo. She was previously an assistant editor at the New Statesman.

Photo: Getty Images
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The buck doesn't stop with Grant Shapps - and probably shouldn't stop with Lord Feldman, either

The question of "who knew what, and when?" shouldn't stop with the Conservative peer.

If Grant Shapps’ enforced resignation as a minister was intended to draw a line under the Mark Clarke affair, it has had the reverse effect. Attention is now shifting to Lord Feldman, who was joint chair during Shapps’  tenure at the top of CCHQ.  It is not just the allegations of sexual harrassment, bullying, and extortion against Mark Clarke, but the question of who knew what, and when.

Although Shapps’ resignation letter says that “the buck” stops with him, his allies are privately furious at his de facto sacking, and they are pointing the finger at Feldman. They point out that not only was Feldman the senior partner on paper, but when the rewards for the unexpected election victory were handed out, it was Feldman who was held up as the key man, while Shapps was given what they see as a relatively lowly position in the Department for International Development.  Yet Feldman is still in post while Shapps was effectively forced out by David Cameron. Once again, says one, “the PM’s mates are protected, the rest of us shafted”.

As Simon Walters reports in this morning’s Mail on Sunday, the focus is turning onto Feldman, while Paul Goodman, the editor of the influential grassroots website ConservativeHome has piled further pressure on the peer by calling for him to go.

But even Feldman’s resignation is unlikely to be the end of the matter. Although the scope of the allegations against Clarke were unknown to many, questions about his behaviour were widespread, and fears about the conduct of elections in the party’s youth wing are also longstanding. Shortly after the 2010 election, Conservative student activists told me they’d cheered when Sadiq Khan defeated Clarke in Tooting, while a group of Conservative staffers were said to be part of the “Six per cent club” – they wanted a swing big enough for a Tory majority, but too small for Clarke to win his seat. The viciousness of Conservative Future’s internal elections is sufficiently well-known, meanwhile, to be a repeated refrain among defenders of the notoriously opaque democratic process in Labour Students, with supporters of a one member one vote system asked if they would risk elections as vicious as those in their Tory equivalent.

Just as it seems unlikely that Feldman remained ignorant of allegations against Clarke if Shapps knew, it feels untenable to argue that Clarke’s defeat could be cheered by both student Conservatives and Tory staffers and the unpleasantness of the party’s internal election sufficiently well-known by its opponents, without coming across the desk of Conservative politicians above even the chair of CCHQ’s paygrade.

Stephen Bush is editor of the Staggers, the New Statesman’s political blog.