Liberal Democrat leader Vince Cable has admitted that the coalition government ‘did serious damage’ to financial education and engagement among young people.
Speaking at the Personal Finance Society Festival, Cable, who was business secretary in the coalition between 2010 and 2015, said young people did not receive enough information about finances.
'One of the big failures of the government that I was part of was we did serious damage to the advice and guidance system in schools, so kids are leaving not only without any understanding of money, but without any understanding of job opportunities.'
Under the coalition government spending on pupils up to GCSE level was protected. However spending for education after pupils turned 16 was cut back. Local council spending cutbacks also hit some careers services.
Cable described a ‘fundamental inequality between generations, which we are now all painfully aware of’ following June's general election, which saw Labour perform much better than expected with policies that appealed to young voters.
He added: ‘Young people do not have access to secure employment, career progression, pensions, can’t get into the housing market unless the bank of mum and dad will help them.'
Cable told advisers that rising levels of debt among young people meant they would benefit from regulated advice.
‘It is a difficult position, so if young people are going to avoid getting into serious indebtedness and continuing financial trouble, they will need advice, and they’re not going to be able to afford to pay for it,' he said.
'So there is a basic question about how we have generic financial education. Some of us have been pushing to have it on school syllabuses and it is happening, but on a small scale.'