Asked by: Stephen Morgan (Labour - Portsmouth South)
Question to the Department for Education:
To ask the Secretary of State for Education, what plans she has to help improve young people’s understanding of finance and credit products; and if she will make a statement.
Answered by Nick Gibb
Education on financial matters helps to ensure that young people are prepared to manage their money well, make sound financial decisions and know where to seek further information when needed.
Finance education forms part of the citizenship National Curriculum, at Key Stages 3 and 4, but can be taught by all schools at all Key Stages. Citizenship covers the functions and uses of money; the importance of personal budgeting; money management; and managing financial risk. At secondary school, pupils are taught information on income and expenditure; credit and debt; insurance, savings and pensions; financial products and services and the need to understand financial risk, including any emerging financial trends. Further information can be found here: https://www.gov.uk/national-curriculum.
The current mathematics curriculum at primary level includes financial education and relevant skills, including calculations with money and using percentages, which provides young people with the knowledge and financial skills to make important financial decisions. The secondary mathematics curriculum develops pupils’ understanding and skills in relation to more complex personal finance issues, such as calculating loan repayments, interest rates and compound interest.
The Money and Pensions Service (MaPS) published financial education guidance for primary and secondary schools in England in November 2021, to support school leaders to enhance their financial education provision. The guidance is available at: https://maps.org.uk/2021/11/11/financial-education-guidance-for-primary-and-secondary-schools-in-england/. This guidance includes links to quality assured resources for schools, including content and activities on cryptocurrencies and buy now, pay later schemes. It also sets out the knowledge and skills pupils need to protect their personal data, critically evaluate online content and identify scams.
The Department is working with MaPS on a series of joint financial education webinars during the 2022/23 academic year, to help both primary and secondary schools, to improve pupils’ skills and knowledge and build teachers’ confidence in this area.
Asked by: Lord Lee of Trafford (Liberal Democrat - Life peer)
Question to the Department for Education:
To ask His Majesty's Government whether they have plans to increase the financial education provided to young people, including teaching about savings, investments, mortgages and other borrowing.
Answered by Baroness Barran - Shadow Minister (Education)
The department wants all young people to manage their money well, make sound financial decisions and know where to seek further information when needed.
Finance education forms part of the citizenship national curriculum, at Key Stages 3 and 4, but can be taught by all schools at all Key Stages.
The subject covers the functions and uses of money, the importance of personal budgeting, money management and managing financial risk. At secondary school, pupils are taught about income and expenditure, credit and debt, insurance, savings and pensions, financial products and services, and how public money is raised and spent.
The mathematics curriculum includes a strong emphasis on the essential arithmetic that primary pupils should be taught. A strong grasp of mathematics will underpin pupils’ ability to manage budgets and money, including using percentages. The secondary mathematics curriculum develops pupils’ understanding in relation to more complex personal finance issues, such as calculating loan repayments, interest rates and compound interest.
The Money and Pensions Service published financial education guidance for primary and secondary schools in England in November 2021, to support school leaders to enhance their financial education provision. The guidance can be found here: https://maps.org.uk/financial-education-in-schools/.
The department and the Money and Pensions Service are also planning a series of joint financial education webinars during this academic year, aimed at promoting the importance of financial education, improving pupils’ skills and knowledge and teachers’ confidence.
Asked by: Peter Gibson (Conservative - Darlington)
Question to the Department for Education:
To ask the Secretary of State for Education, what plans his Department has to help improve financial literacy amongst young people.
Answered by Kelly Tolhurst
Finance education forms part of the citizenship national curriculum, which can be taught at all key stages and is compulsory at key stages 3 and 4. More information about the content of the national curriculum can be found at: https://www.gov.uk/national-curriculum.
Financial education ensures that pupils are taught the functions and uses of money, the importance of personal budgeting, money management, and managing financial risk. At secondary school, pupils are taught about income and expenditure, credit and debt, insurance, savings and pensions, financial products and services, and how public money is raised and spent.
The mathematics curriculum, which is compulsory at key stages 1 to 4 also develops financial skills. At primary level, there is a strong emphasis on the essential arithmetic knowledge that pupils should be taught. This knowledge is vital, as a strong grasp of numeracy and numbers will underpin pupils’ ability to manage budgets and money, including, for example, using percentages. There is also some specific content about financial education, such as calculations with money.
The secondary mathematics curriculum develops pupils’ understanding and skills in relation to more complex personal finance issues, such as calculating loan repayments, interest rates and compound interest.
As with other aspects of the curriculum, schools have flexibility over how they deliver these subjects, so they can develop an integrated approach that is sensitive to the needs and background of their pupils.
The Money and Pensions Service published financial education guidance for primary and secondary schools in England on 11 November 2021, during Talk Money week. The guidance is designed to support school leaders to enhance the financial education currently delivered in their schools to make it memorable and impactful. Further information can be accessed at: https://maps.org.uk/2021/11/11/financial-education-guidance-for-primary-and-secondary-schools-in-england/.
The department and the Money and Pensions Service will deliver a series of joint financial education webinars during the 2022/23 academic year, aimed at promoting the importance of financial education, improving teacher confidence, skills and knowledge and providing a launchpad for further engagement with training and resources to support continuous improvement.
Asked by: Baroness Sater (Conservative - Life peer)
Question to the Department for Education:
To ask Her Majesty's Government what plans they have to improve the provision of financial education for pupils eligible for free school meals.
Answered by Baroness Barran - Shadow Minister (Education)
The department wants all schools to offer high standard of financial education. In delivering the curriculum, including financial education, schools should take account of pupils with particular needs and adapt lessons accordingly.
Education on financial matters helps to ensure that pupils are taught the functions and uses of money, the importance of personal budgeting, money management and managing financial risk. Finance education forms part of the citizenship national curriculum which can be taught at all key stages and is compulsory at key stages 3 and 4: https://www.gov.uk/national-curriculum. At secondary school, pupils are taught about income and expenditure, credit and debt, insurance, savings and pensions, financial products and services, and how public money is raised and spent.
The department has also introduced a rigorous mathematics curriculum, which provides young people with the knowledge and financial skills to make important financial decisions. In the primary mathematics curriculum, there is a strong emphasis on the essential arithmetic knowledge that pupils should be taught. This knowledge is vital, as a strong grasp of numeracy and numbers will underpin pupils’ ability to manage budgets and money, including, for example, using percentages. There is also some specific content about financial education, such as calculations with money.
The department has not made any specific requirement for financial education provision for pupils who are eligible for free school meals, however, as with other aspects of the curriculum, schools have flexibility over how they deliver these subjects. This means schools can develop an integrated approach that is sensitive to the needs and background of their pupils.
The Money and Pensions Service published financial education guidance for primary and secondary schools in England, to support school leaders to enhance the financial education currently delivered in their schools to make it memorable and impactful. The guidance is available here: https://maps.org.uk/2021/11/11/financial-education-guidance-for-primary-and-secondary-schools-in-england/.
The department will continue to work closely with the Money and Pensions Service and other stakeholders, such as HM Treasury, to consider learning from other sector initiatives and whether there is scope to provide further support for the teaching of financial education in schools.
Asked by: Julian Knight (Independent - Solihull)
Question to the Department for Education:
To ask the Secretary of State for Education, whether his Department is taking steps to increase the provision of financial education to help support the Levelling Up agenda.
Answered by Robin Walker
Levelling up is at the heart of the agenda to build back better after the COVID-19 pandemic and to deliver for every part of the UK. In education, ability is evenly spread but opportunity is not. The department aims to reduce the dependency of people’s education and skills outcomes on where they live by ensuring that in every area children are able to access excellent schools, progress to high quality technical and higher education, and go on into good jobs.
Education on financial matters helps to ensure that young people are prepared to manage their money well, make sound financial decisions and know where to seek further information when needed. Finance education forms part of the citizenship national curriculum which can be taught at all key stages and is compulsory at key stages 3 and 4. Further information is available here: https://www.gov.uk/national-curriculum. Financial education ensures that pupils are taught the functions and uses of money, the importance of personal budgeting, money management and managing financial risk. At secondary school, pupils are taught about income and expenditure, credit and debt, insurance, savings and pensions, financial products and services, and how public money is raised and spent.
The department has introduced a rigorous mathematics curriculum, which provides young people with the knowledge and financial skills to make important financial decisions. In the primary mathematics curriculum, there is a strong emphasis on the essential arithmetic knowledge that pupils should be taught. This knowledge is vital, as a strong grasp of numeracy and numbers will underpin pupils’ ability to manage budgets and money, including, for example, using percentages. There is also some specific content about financial education, such as calculations with money.
The secondary mathematics curriculum develops pupils’ understanding and skills in relation to more complex personal finance issues such as calculating loan repayments, interest rates and compound interest.
As with other aspects of the curriculum, schools have flexibility over how they deliver these subjects, so they can develop an integrated approach that is sensitive to the needs and background of their pupils. The Money and Pensions Service published financial education guidance for primary and secondary schools in England, to support school leaders to enhance the financial education currently delivered in their schools to make it memorable and impactful. This guidance is available here: https://maps.org.uk/2021/11/11/financial-education-guidance-for-primary-and-secondary-schools-in-england/.
The department will continue to work closely with the Money and Pensions Service and other stakeholders such as HM Treasury, to consider learning from other sector initiatives and whether there is scope to provide further support for the teaching of financial education in schools.
Asked by: Lord Watson of Invergowrie (Labour - Life peer)
Question to the Department for Education:
To ask Her Majesty's Government what assessment they have made of the impact of proposed changes to student loan repayments on sectors of the economy experiencing staffing shortages, such as (1) nursing, and (2) teaching.
Answered by Baroness Barran - Shadow Minister (Education)
It is important that we have a sustainable student finance system that is fair to graduates and taxpayers.
For new students entering higher education from September 2023 onwards, the government is reducing the interest rates charged on student loans to RPI+0%. This means that no one who takes out a loan under these new terms will repay more than they originally borrowed when adjusted for inflation. These new loans will have a repayment threshold of £25,000 per year (increasing with inflation from April 2027) and a term of 40 years. For existing borrowers and students who start in the 2022/23 academic year, the government will be maintaining the repayment threshold at its current level of £27,295 per year up to and including the 2024/25 financial year, and increasing it annually in line with inflation thereafter.
Borrowers on both the new and the existing loan terms will continue to benefit from the unique protections that student loans offer. Individuals earning under the relevant repayment threshold will not be required to make any repayments at all, and any outstanding loan debt will be written off at the end of the loan term at no personal detriment. No commercial loans protect borrowers in these ways.
A full impact assessment of the department’s student finance reforms is available here: https://www.gov.uk/government/publications/higher-education-reform-equality-impact-assessment. Department analysis found that the system will remain progressive overall.
The government will continue to support recruitment into certain priority sectors through targeted incentives. In nursing, midwifery and allied health subjects, new and continuing students on pre-registration courses at English universities have, from September 2020, benefitted from at least £5,000 per academic year of additional maintenance grant funding which they will not need to pay back. There is also up to £3,000 of further funding available for students with child dependants or students studying specialist disciplines that struggle to recruit. These grants come as part of the government’s manifesto commitment to increase nurse numbers by 50,000 by 2025.
In teaching, the government has put in place a range of measures, including bursaries worth up to £24,000 and scholarships worth up to £26,000, to encourage talented trainee teachers to key subjects such as chemistry, computing, mathematics and physics.
Asked by: Emma Hardy (Labour - Kingston upon Hull West and Haltemprice)
Question to the Department for Education:
To ask the Secretary of State for Education, what steps he is taking to improve the financial literacy of school children in Kingston upon Hull West and Hessle.
Answered by Robin Walker
Education on financial matters helps to ensure that young people are prepared to manage their money well, make sound financial decisions, and know where to seek further information when needed.
Financial education forms part of the citizenship national curriculum which can be taught at all key stages and is compulsory at key stages 3 and 4: https://www.gov.uk/national-curriculum. Financial education ensures that pupils are taught the functions and uses of money, the importance of personal budgeting, money management and managing financial risk. At secondary school, pupils are taught about income and expenditure, credit and debt, insurance, savings and pensions, financial products and services, and how public money is raised and spent.
The department has introduced a rigorous mathematics curriculum, which provides young people with the knowledge and financial skills to make important financial decisions. In the primary mathematics curriculum, there is a strong emphasis on the essential arithmetic knowledge that pupils should be taught. This knowledge is vital, as a strong grasp of numeracy and numbers will underpin pupils’ ability to manage budgets and money, including, for example, using percentages. There is also some specific content about financial education, such as calculations with money.
The secondary mathematics curriculum develops pupils’ understanding and skills in relation to more complex personal finance issues such as calculating loan repayments, interest rates, and compound interest.
As with other aspects of the curriculum, schools have flexibility over how they deliver these subjects, so they can develop an integrated approach that is sensitive to the needs and background of their pupils.
The Money and Pensions Service published financial education guidance for primary and secondary schools in England on 11 November 2021, during Talk Money week. The guidance is designed to support school leaders to enhance the financial education currently delivered in their schools to make it memorable and impactful, and is available to view here: https://maps.org.uk/2021/11/11/financial-education-guidance-for-primary-and-secondary-schools-in-england/.
The department will continue to work closely with the Money and Pensions Service and other stakeholders such as Her Majesty's Treasury, to consider learning from other sector initiatives and whether there is scope to provide further support for the teaching of financial education in schools.
Asked by: Matt Western (Labour - Warwick and Leamington)
Question to the Department for Education:
To ask the Secretary of State for Education, what recent assessment he has made of the impact on BAME students of the current student loan repayment conditions.
Answered by Michelle Donelan
The student loan system in England removes financial barriers for those hoping to study higher education while sharing its costs between learners and the general taxpayer. The loans offer unique protections to borrowers. During and after study, interest rates are capped so that they do not exceed the prevailing market rate for comparable personal loans. After finishing study, monthly repayments are only required when a borrower is earning over the repayment threshold, currently £27,295 per year, or its weekly or monthly equivalent for Plan 2 (post-2012) loans and do not change based on rates or the amount borrowed. Any outstanding debt is written off after the loan term ends at no detriment to the borrower.
As student loan repayments are income contingent, the impact of the repayment threshold and repayment conditions on students with particular protected characteristics depends on the earnings of those borrowers in each year over the loan term. The department publishes annual data on graduate employment and earnings by years after graduation, including by ethnicity, through the Graduate Outcomes publication which can be found here: https://explore-education-statistics.service.gov.uk/find-statistics/graduate-outcomes-leo/2018-19.
Regular assessments of the student finance system, including forecasts of future loan outlay, repayments and the size of the loan book, are made and published annually. The most recent publication can be found here: https://www.gov.uk/government/statistics/student-loan-forecasts-england-2020-to-2021. This publication notes that the Resource Accounting and Budget (RAB) charge the proportion of loan outlay that is expected to not be repaid when future repayments are valued in present terms, was estimated to be 53% for loans issued to full-time undergraduates in the 2020-21 financial year. The interest rate adds to the total amount of repayments received, and for the 2020-21 loans, the department estimates that repayments due to interest reduces the RAB charge by 4 percentage points.
Potential reforms to student loan terms, with the goal of decreasing the public subsidy on student loans while preserving the income-contingent nature of the current system, were modelled as part of the work done by the independent panel which reported to the Review of Post-18 Education and Funding. We are carefully considering a range of options to ensure that student finance continues to deliver value for money for both students and the taxpayer as we continue to consider the recommendations made by the independent panel. The interim conclusion was published on 21 January 2021, and we plan to set out a conclusion to the review in due course.
Asked by: Matt Western (Labour - Warwick and Leamington)
Question to the Department for Education:
To ask the Secretary of State for Education, what recent assessment he has made of the impact on BAME students of any changes to the student loan repayment threshold.
Answered by Michelle Donelan
The student loan system in England removes financial barriers for those hoping to study higher education while sharing its costs between learners and the general taxpayer. The loans offer unique protections to borrowers. During and after study, interest rates are capped so that they do not exceed the prevailing market rate for comparable personal loans. After finishing study, monthly repayments are only required when a borrower is earning over the repayment threshold, currently £27,295 per year, or its weekly or monthly equivalent for Plan 2 (post-2012) loans and do not change based on rates or the amount borrowed. Any outstanding debt is written off after the loan term ends at no detriment to the borrower.
As student loan repayments are income contingent, the impact of the repayment threshold and repayment conditions on students with particular protected characteristics depends on the earnings of those borrowers in each year over the loan term. The department publishes annual data on graduate employment and earnings by years after graduation, including by ethnicity, through the Graduate Outcomes publication which can be found here: https://explore-education-statistics.service.gov.uk/find-statistics/graduate-outcomes-leo/2018-19.
Regular assessments of the student finance system, including forecasts of future loan outlay, repayments and the size of the loan book, are made and published annually. The most recent publication can be found here: https://www.gov.uk/government/statistics/student-loan-forecasts-england-2020-to-2021. This publication notes that the Resource Accounting and Budget (RAB) charge the proportion of loan outlay that is expected to not be repaid when future repayments are valued in present terms, was estimated to be 53% for loans issued to full-time undergraduates in the 2020-21 financial year. The interest rate adds to the total amount of repayments received, and for the 2020-21 loans, the department estimates that repayments due to interest reduces the RAB charge by 4 percentage points.
Potential reforms to student loan terms, with the goal of decreasing the public subsidy on student loans while preserving the income-contingent nature of the current system, were modelled as part of the work done by the independent panel which reported to the Review of Post-18 Education and Funding. We are carefully considering a range of options to ensure that student finance continues to deliver value for money for both students and the taxpayer as we continue to consider the recommendations made by the independent panel. The interim conclusion was published on 21 January 2021, and we plan to set out a conclusion to the review in due course.
Asked by: Matt Western (Labour - Warwick and Leamington)
Question to the Department for Education:
To ask the Secretary of State for Education, what recent assessment he has made of the sustainability of the student loan system and its effect on the public finances under the current repayment thresholds.
Answered by Michelle Donelan
The student loan system in England removes financial barriers for those hoping to study higher education while sharing its costs between learners and the general taxpayer. The loans offer unique protections to borrowers. During and after study, interest rates are capped so that they do not exceed the prevailing market rate for comparable personal loans. After finishing study, monthly repayments are only required when a borrower is earning over the repayment threshold, currently £27,295 per year, or its weekly or monthly equivalent for Plan 2 (post-2012) loans and do not change based on rates or the amount borrowed. Any outstanding debt is written off after the loan term ends at no detriment to the borrower.
As student loan repayments are income contingent, the impact of the repayment threshold and repayment conditions on students with particular protected characteristics depends on the earnings of those borrowers in each year over the loan term. The department publishes annual data on graduate employment and earnings by years after graduation, including by ethnicity, through the Graduate Outcomes publication which can be found here: https://explore-education-statistics.service.gov.uk/find-statistics/graduate-outcomes-leo/2018-19.
Regular assessments of the student finance system, including forecasts of future loan outlay, repayments and the size of the loan book, are made and published annually. The most recent publication can be found here: https://www.gov.uk/government/statistics/student-loan-forecasts-england-2020-to-2021. This publication notes that the Resource Accounting and Budget (RAB) charge the proportion of loan outlay that is expected to not be repaid when future repayments are valued in present terms, was estimated to be 53% for loans issued to full-time undergraduates in the 2020-21 financial year. The interest rate adds to the total amount of repayments received, and for the 2020-21 loans, the department estimates that repayments due to interest reduces the RAB charge by 4 percentage points.
Potential reforms to student loan terms, with the goal of decreasing the public subsidy on student loans while preserving the income-contingent nature of the current system, were modelled as part of the work done by the independent panel which reported to the Review of Post-18 Education and Funding. We are carefully considering a range of options to ensure that student finance continues to deliver value for money for both students and the taxpayer as we continue to consider the recommendations made by the independent panel. The interim conclusion was published on 21 January 2021, and we plan to set out a conclusion to the review in due course.