Minister McGrath publishes Mapping Report on the development of a Financial Literacy Strategy in Ireland

The Minister for Finance, Michael McGrath TD, has today (19 April 2024) published a Mapping Report on the development of a National Financial Literacy Strategy in Ireland.

Financial literacy and education is an important part of financial consumer protection. Financial literacy covers people's awareness, behaviour, knowledge, attitudes and skills in relation to money and is an important skill that everyone should have throughout their lives.

This report collates the extent of the current provision, across many organisations, of financial education in Ireland, and provides evidence, analysis and recommendations for the next stage of the design and development of a national strategy.

On the basis of extensive stakeholder engagement to date, including responses to a stakeholder survey issued in August 2023, this report describes the various bodies currently involved in delivering financial education in Ireland. It also sets out potential gaps and themes to be addressed in a financial literacy strategy and stakeholder expectations of that strategy.

Key report highlights

• Many organisations across Ireland are already active in financial education, across public bodies, the financial services industry and non-profit sector.
• These efforts need to be supported and given a clear and coherent framework in a national financial literacy strategy.
• There is widespread support amongst stakeholders for the development of a national financial literacy strategy.
• Around 57% of adults in Ireland meet the minimum OECD level of financial literacy. A minimum level of financial literacy means they can manage their money on a day-to-day basis with ease and can consider their long-term financial wellbeing.
• This leaves about 43% of adults in Ireland without the minimum financial literacy needed. In addition to this, 44% of the adult population do not have the minimum level of digital financial literacy needed to navigate their finances.
• It is clear there is still work to do to improve financial literacy in Ireland. At the moment, most financial education programmes are broadly aimed at the general population. There should be a greater focus on tailoring financial education, especially for certain groups who we know have lower financial literacy, such as:

- Women,

- Unemployed people,

- Those on low incomes,

- Those with lower levels of education, and

- Older people.

• Financial education should begin in early childhood, ideally in pre-school education. Currently, many financial education programmes for children and young people are aimed at senior cycle in secondary school (from about age 16 onwards).
• There are opportunities for financial literary learning at every level in the school curriculum. The teaching of financial education through the curriculum should be supported, particularly through core subjects, such as Mathematics.
• Many current financial education programmes focus on important skills such as budgeting and saving. Further financial education should be supported in relation to:

- managing debt and supporting those struggling with debt to seek support,

- digital financial literacy,

- making decisions around investments, and

- SME financial literacy.

The Department of Finance will work with stakeholders to develop a national financial literacy strategy for Ireland, including a governance structure and action plan. This will be published by the end of 2024.

Commenting on today's publication, Minister McGrath said:

"The publication of this Mapping Report today represents a significant milestone in the development of the first National Financial Literacy Strategy for Ireland.

Since I announced the commencement of work on the development of this strategy in July last year, my officials have engaged extensively with a wide range of relevant stakeholders. I am very grateful to the many stakeholders who took the time to respond to our survey on financial education last August/September and to attend a subsequent stakeholder event. The level of responses received to the survey together with the ongoing engagement, support and enthusiasm shown by many stakeholders on the further development of financial literacy demonstrates how important this topic is to the overall financial wellbeing of Irish citizens.

While Irish adults score well on financial literacy compared to other OECD countries, there is still a significant amount of the adult population that do not have the minimum level of financial literacy needed for managing their money on a day-today-basis or to consider their long-term financial wellbeing.

The next phase of our work will involve preparing a National Financial Literacy Strategy, an action plan and an appropriate governance structure to ensure the successful implementation of the strategy. I aim to publish the National Financial Literacy Strategy by the end of 2024 and I look forward to engaging with stakeholders further in advance of publication."

Notes to Editors:

1. In 2022, the Retail Banking Review recommended that the Department of Finance should seek to ensure that all stakeholders work together so that Ireland is compliant with the OECD High Level Principles on Financial Consumer Protection and the Recommendation on Financial Literacy.

2. This project was launched by the Minister for Finance in July 2023. The aim of a national financial literacy strategy will to take a sustained, co-ordinated approach to financial literacy across stakeholders in Ireland, which will be developed in line with the OECD Recommendation on Financial Literacy.

3. The 2020 OECD Recommendation on Financial Literacy defines financial literacy as:

"a combination of financial awareness, knowledge, skills, attitudes and behaviours necessary to make sound financial decisions and ultimately achieve individual financial well-being."

4. In developing a national financial literacy strategy, the OECD guidance recommends that governments establish and implement national strategies that are evidence-based and co-ordinated with other strategies that foster economic and social prosperity and provide a framework for cooperation among all stakeholders on financial education.

5. This Report is the first key deliverable of the work and involved:

• Collecting relevant evidence on levels of financial literacy and financial education provision in Ireland.
• Extensive stakeholder engagement, including bilateral meetings, a stakeholder survey and a stakeholder event held in November 2023.
• A review of relevant national and international examples, including ongoing engagement with other EU Member States who are in the process of or have recently developed similar strategies.
• Engagement with the OECD on international best practice.
• Identifying areas of financial literacy gaps in Ireland to be closed.
• Identifying possible target groups/audiences that possible financial literacy interventions.

Mapping Report on the development of a National Financial Literacy Strategy