Battle brews over money education

There have been calls for more guidance on money matters

The government could face a battle over funding for a national money education scheme announced in the Queen's Speech.

The speech outlined plans to improve financial literacy, including a money guidance service for consumers.

But the British Bankers' Association, which speaks for UK banks, said it was not keen on an extra levy on financial institutions to pay for the teaching.

It said that the industry already paid £100m a year towards financial education.

"At the heart of the relationship between banks and customers is a well educated, financially literate consumer base," a spokesman for the association said.

"Banks are fully committed to financial education and would support moves to refocus and target the estimated £100m a year they already pay towards financial education.

"Simply asking the industry to pay more is not the best way to achieve the right result."

Plans

The government wants financial education to be the responsibility of a new consumer education and information authority, independent of the Financial Services Authority. This would give advice for free to struggling consumers.

There have been calls for greater guidance on money matters with growing numbers of people facing spiralling debts.

The government also plans to help consumers get redress more easily by introducing US-style class actions under which a consumer representative will be able to bring an action to court on behalf of a group of consumers. The Financial Services and Business Bill would also outlaw the distribution of unsolicited credit card cheques.

These proposals have previously been announced as part of the government's plans on personal finance issues.