Ross Vasta (Bonner, Liberal Party) Share this | Link to this | Hansard source

I move:

That this House:

(1) recognises that;

(a) financial literacy rates in Australia are in decline;

(b) enrolments in economic based subjects, which incorporate financial literacy in the national curriculum, has declined by 70 per cent over the past three decades;

(c) enrolments in maths-based subjects has decreased from 76 per cent to 66 per cent in 2020, and boys outnumber girls 2 to 1 in these subjects;

(d) only around 50 per cent of Australians are considered financially literate, with women having significantly worse outcomes compared to their male counterparts;

(e) on average, 50 per cent of Australians live pay-check to pay-check;

(f) financial hardship is one of the most commonly cited contributors to poor mental health;

(g) Australian students are falling behind other Organisation for Economic Co-operation and Development nations in financial literacy performance, based on the Program for International Student Assessment Survey data;

(h) 20 per cent of Australian students do not meet baseline levels of financial literacy; and

(i) the 2021 Australian Government Australian Financial Capability Survey indicates that 94 per cent of young Australians aged 14 to 17 either agreed or strongly agreed that is important to learn how to manage their money; and

(2) calls on:

(a) the Government to make financial literacy a compulsory part of the national curriculum and extend this into the senior years of schooling; and

(b) all Members of Parliament to support measured and considered action to improve financial literacy outcomes in this country across all demographics.

This country is in the midst of a cost-of-living crisis. Interest rates are rising, everyday household items are becoming more expensive and families are worried about making ends meet. Whilst times are certainly tough for Australians, there is an underlying contributing factor that we are simply not speaking about: Australia's declining financial literacy standards.

Financial literacy is the possession of the skills and knowledge necessary to make smart and informed decisions about your personal finances. It is one of the most basic and important skill sets that every person and Australian should and must have. Whether they're trying to save for their first house, paying for their child's education or making their weekly shopping list, every day every Australian makes personal financial decisions that impact their bottom line. Alarmingly, though, 86 per cent of Australians do not know or understand their monthly expenses.

Australia also ranks fifth in the world out of all the OECD countries for the highest percentage of household debt, and now we have a combined total of over $17 billion of personal credit card debt in this country. Simply put, Australians' relationship with their own money needs to change. This is not a mindset or cycle we want our children and grandchildren to fall into. That's why I'm calling upon the federal government to introduce compulsory financial literacy as part of the national curriculum. If we look at where our children receive their financial literacy from, most children get their personal financial understanding from either their parents or maths based subjects in school. But with only 50 per cent of Australian adults considered to be financially literate, and a significant decrease in enrolments in maths- and economics-based subjects in senior years, it is clear that we have a problem.

If we delve into this even further, the fact that maths is not compulsory in all Australian states and territories in senior years and that boys usually outnumber girls by two to one in maths based subjects means that we have created a very real situation in which some children, especially young girls, grow up never having an informed discussion about their personal finances. No wonder there is a direct correlation between increased rates of homelessness amongst women and a lack of financial literacy. Financial literacy in schools would help reduce homelessness amongst women as it would give young girls the skills to be more actively engaged in managing their own finances later in life.

Financial literacy in schools would also improve mental health and the wellbeing of Australians. A recent study by ASIC and Beyond Blue highlights that people who are experiencing financial challenges are twice as likely to have experienced mental health challenges. Financial stress also leads to relationship and marriage breakdowns, increased depression and anxiety, and an overall decrease in the quality of their life. So, not only does this motion help with creating better financial habits for the next generation; it also helps address the social and emotional wellbeing of Australians. Financial literacy in schools would make not only our households grow stronger and more adaptable but so, too, our nation.

It is our responsibility to ensure that the next generation is equipped with the skills that they need to be confident in making smart personal financial decisions so that they can get ahead, especially as we become a cashless society, where knowing what a dollar is and understanding the value of that dollar will become increasingly difficult for future generations to understand. What is a budget? How do interest rates work? What are the implications of credit scores and superannuation? How to save, how to invest and how to live within your means should be taught in schools and must become compulsory as part of our National Curriculum. Financial literacy in schools would mean that those children born into disadvantaged families could learn in the classroom how to save and invest and work towards a better life. Financial literacy in schools would mean that we could help the next generation avoid unnecessary household and credit card debt, because they would be smarter about their financial choices. And financial literacy in schools would mean creating a generation of financially resilient Australians who are in control of their own money.

Andrew Wilkie (Clark, Independent) Share this | Link to this | Hansard source

Is the motion seconded?

Bert Van Manen (Forde, Liberal Party) Share this | Link to this | Hansard source

I second the motion and reserve my right to speak.

Peta Murphy (Dunkley, Australian Labor Party) Share this | Link to this | Hansard source

I thank the member for Bonner for putting forward this motion, much of which is absolutely on the mark, about the need to increase financial literacy. It's just a shame that the government he was a part of negotiated the National Curriculum while it was in government and didn't do this, over 10 years. I don't know: perhaps the member for Bonner asked them to and they didn't listen, so he's hoping to get a better reception from a government that is very serious about supporting financial literacy initiatives across the country.

I want to tell the Federation Chamber about a remarkable program that operates in my community that showcases the value of financial education. It's the Brotherhood of St Laurence's Saver Plus program, which I first became aware of after I was elected and was visiting Aldercourt Primary School in Frankston North with the Brotherhood. Saver Plus is a financial education program for families and individuals who are on a tight budget, to develop lifelong saving habits. It sounds kind of simple, doesn't it? But it's not that simple for many people. One of the stories we heard during the visit was from a local mum who spoke of the difference a course like that had made not just to her but to her child and to their life—something as commonplace, for many people, as enrolling your child in swimming lessons. She knew her finances weren't good. She knew she needed to work on them. But she just found it too complicated—a single mum, too busy, too overwhelmed, who didn't know where to start and so didn't start. But she did start the Saver Plus program. Her goal was to save up enough money so her child could do that most basic thing in Australia: learn how to swim. Her story was remarkable, because Saver Plus provided her with the capacity and knowledge she wanted and needed. Not only was she able to put her child through swimming lessons but she was able to get her finances back on track and to talk about the changes she had made in her life and the way she dealt with her very tight finances to ensure that there was enough money for those 'extra' things like swimming lessons and saving for a rainy day.

Certainly in Melbourne there have been a lot of rainy days lately, but that metaphor of a rainy day, I think, extends to what people are calling the cost-of-living crisis at the moment. Lots of people are experiencing rainy days, and financial literacy is such a fundamentally important tool for people to have before they hit those rainy days. There are literally hundreds of people on the Mornington Peninsula and in Frankston who have taken advantage of Saver Plus. There was another program I learnt about while I was at Aldercourt, which is the HIPPY program. This program also empowers parents. It provides them with the tools, knowledge and confidence to engage in their child's education, and that's having a profound impact as well on the community. Again, it's not solely for single mothers, but single mothers in particular are finding ways to support themselves and their child's development and setting up their families for healthier and brighter futures.

These are the sorts of programs that I want to see governments invest in, because they're programs that help people invest in themselves, including people who come from circumstances where they haven't been unable to invest in themselves before and who just need that bit of assistance. This is why the government that I'm proud to be a part of has introduced a number of measures in the last 12 months that go towards helping people who are caught because of a lack of financial and other literacy by scams and online frauds, for example—not just in terms of pursuing the people who are doing it but in terms of helping to educate people how not to be caught. It's often the other end of the age scale—not the young parents but older members of our community—who get caught by those online scams. I almost got caught by phone calls from someone pretending to be from my bank. They're very sophisticated and that's also a very important thing to do. There was also an announcement this week about regulating buy-now pay-later services to help people only spend the money that they can afford or only borrow the money they can afford to pay back.

Bert Van Manen (Forde, Liberal Party) Share this | Link to this | Hansard source

I would like to thank the member for Bonner for bringing the motion to the House. Literacy and numeracy skills—and particularly financial literacy skills, as the member for Bonner has outlined in this motion—underpin a range of essential skills which will equip people throughout their lives. These are critically important. In the community that I represent in Logan, I see those in our community who have tremendous financial literacy skills and have gone on to great success in any number of areas or endeavours. But equally, sadly, I have seen those who have struggled with financial literacy skills, and for many, this has impacted on their ability to be involved in the workforce, with some finishing up in situations where they think they've got to take a chance gambling or finding other ways to try and make money because they've not been able to manage their financial circumstances properly.

I want to extend the member for Bonner's motion a little bit to include not just financial literacy and numeracy skills but literacy and numeracy more generally. We know that having proficiency in literacy and numeracy has a pivotal impact on people's social and health outcomes throughout their life. It impacts not just the parents who struggle with those basic skills but also the kids who are raised in those households. We see that transferred to the younger generation. Certainly, in my electorate of Forde and across the city of Logan, we see families that have struggled with the generational impact of a lack of literacy and numeracy skills. It provides an inability for young people to successfully engage in the workforce and it creates challenges, as the member for Bonner quite rightly touched on. It has an impact on people's mental health later in life, further discouraging them from participating meaningfully in society.

I would like to take this opportunity to give a shout-out to the Financial Literacy Action Group, which is based in Logan and seeks to help people in these very circumstances. It's a broad-ranging community organisation, a coalition of various groups that provides help and assistance to people in this situation.

What's important is how we start to deal with these issues for the longer term, and I believe that starts at school. If you look at the results from our education system, Australia's results in reading and mathematical literacy have declined sharply over the last 20 years. Unfortunately, the member for Dunkley sought to make a political point on this, but I would say that governments of all persuasions have presided over these results for a long period of time, and we in this place all need to accept responsibility for that, irrespective of what side of the chamber we are on. The solution to this problem is a bipartisan one. It's not a partisan solution; we need to work together to solve these problems, because they exist in communities right across the country.

When I talk to my school principals about the national curriculum, they say to me: 'It is so overcrowded that we genuinely don't have the time to focus in detail on these basic skills with the students who are struggling with them.' I had a meeting as late as last week with one of my school principals and I asked him whether he was in a position to have a differentiated curriculum for those students who are struggling with the standard curriculum in order to assist them to build on these basic skills and set them up for the future. He said he would love to do that; however, he's worried that, if he does start doing something different with the curriculum and different from what is allowed under the national curriculum, at an audit he might lose funding or have his funding reduced, so why would he take that risk? That's why I say that we need to have a broad-ranging discussion about a bipartisan solution.

We need to look at these basic skills, which the member for Bonner has well outlined in this motion. I think it's critically important for the future. (Time expired)

Sam Rae (Hawke, Australian Labor Party) Share this | Link to this | Hansard source

I'd like to thank the member for Bonner for bringing this motion to the chamber. There are some critically important points here for us to cover. I have regard for him personally. I can't help but notice, though, the irony of the Liberal Party bringing forward a financial literacy motion to us.

Jerome Laxale (Bennelong, Australian Labor Party) Share this | Link to this | Hansard source

It's a massive worry.

Sam Rae (Hawke, Australian Labor Party) Share this | Link to this | Hansard source

When this government was elected 12 months and one day ago, Labor member for Bennelong, we inherited a trillion dollars of Liberal debt. What we didn't inherit were the mugs that had gone with the claim of surplus that we never saw come to fruition. I think that's a decent place to start as we drill our way through the challenges of financial literacy in our society. It's where a former government essentially preyed upon some of the gap of knowledge in our community in order to serve their political purposes at the expense of increasing understanding and, indeed, having a robust and honest debate about our country's financial position. In fact, the now opposition spent nine years in government running financial capability surveys, but, when it came to improving financial literacy through education pursuits and consumer protection efforts, they left Australians to fend for themselves.

The Albanese government has taken a totally different approach to this in many ways. I note we have delivered our first full-financial-year budget. The Treasurer, Jim Chalmers, did so a week and a half ago. It was our first full-financial-year budget and it had the first surplus in 15 years.

Jerome Laxale (Bennelong, Australian Labor Party) Share this | Link to this | Hansard source

Back in black!

Sam Rae (Hawke, Australian Labor Party) Share this | Link to this | Hansard source

Yes, back in black, Member for Bennelong. So when our government speaks to the financial position of the country, when we come to the Australian people and explain to them the way that we are managing the economic challenges that our country faces, we do so with honesty and integrity. We delivered a small surplus, but there are challenges on the horizon. We have been upfront about that. We haven't tried to sugar-coat it or dress up a decade of budget deficit in egotism and cheap giftshop paraphernalia.

When it comes to consumer affairs more broadly—and this is the very serious crux of where some of our financial literacy challenges lie—we have had a laser-like focus on improving consumer protections and creating safe and well-regulated financial markets. This has been part of a broader effort. We're boosting education. We're boosting awareness. We're bringing Australians along on the journey with us to understand the risks that they face when there are predatory players in the market.

After this decade of denial, delay and neglect, we've had to clean up this mess that was left by the Liberals. We've done more for Australian consumers in just one year than the last government did in nine years. In fact, we've done more in the last fortnight. In this budget, we brought forward an $86.5 million package to combat scams and online fraud, including $58 million for the ACCC to set up the National Anti-Scam Centre. As well as its work bringing together expertise from across government and the private sector to detect and deter scams, the NASC will drive consumer awareness and, importantly, education to ensure that consumers are better able to protect themselves from scams and improve their financial literacy along the way.

This package also includes funding to address scam SMSs. They can lead to huge financial losses, as we know. We all know somebody who has been preyed upon in that regard. The fighting scams package will address the massive problem where last year $3 billion was lost to scams by Australians. That's grown fivefold since 2020. The Abbott, Turnbull and Morrison governments left Australians to fend for themselves against scammers. In particular, they ignored the explosion in scams brought on by the pandemic.

On Monday, we announced reform to the regulation of 'buy now, pay later' to protect vulnerable consumers from the risks of unregulated credit products and unaffordable lending. These are real interventions being made by the Albanese government, in stark contrast to the failure and neglect of the previous government that is most pertinently exemplified by their trillion dollars of Liberal debt. (Time expired)

Jenny Ware (Hughes, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on the motion brought forward by the honourable member for Bonner. I thank him for bringing this motion and I support this motion. This motion concerns education, particularly in the field of financial literacy. We need to be empowering our students, our children, our youth, to be financially literate, to better understand our financial institutions and to be confident dealing with their own finances now and into the future.

Many have spoken about education, probably more elegant eloquently than I will tonight, but there are three particular quotes that I wish to raise. First of all, Nelson Mandela said:

Education is the most powerful weapon you can use to change the world.

Centuries before Nelson Mandela, Socrates said:

Education is the kindling of a flame, not the filling of a vessel.

And, one of my personal favourites as a West Wing tragic was Sam Seaborn, played by Rob Lowe in TheWest Wing:

education is the silver bullet. Education is everything. We don't need little changes, we need gigantic, monumental changes. Schools should be palaces. The competition for the best teachers should be fierce. They should be making six-figure salaries.

I should have brought my glasses!

Schools should be incredibly expensive for government and absolutely free of charge to its citizens, just like national defense.

How good is Aaron Sorkin's writing?

I will, whilst ever I'm in this place, speak on education whenever I can. I say this, as well, as the daughter of a teacher. My mum, Jan, was a primary school teacher, and I thank her particularly for imbibing in me a lifelong love of learning, something that we as a community should inspire to do in our younger Australians. Teachers are doing this every day.

I first acknowledge the fabulous teachers within my electorate of Hughes and the incredible work they do every day, both within and without the classroom, to educate. I have my good friends, Carolyn Ryder, a primary school teacher from Heathcote, and Murray Collis and Marina Collis, high school teachers from Loftus. As I engage with my electorate, it has been a pleasure and a privilege to meet with leadership teams and students at my local schools. Recently, these are Inaburra School, Como Public School, Shire Christian School, Wattle Grove Public School, Hammondville Public School, Minerva School and St Joseph's Catholic primary schools at both Como and Holsworthy. Excellent work is being done at all of these schools. Students are engaged and interested.

Broadly, however, Australia's education standards on the world stage have been declining for many years. We can look at recent NAPLAN results to see that. I know those results have been spoken about in this place, and I don't intend to reiterate all of them. However, we are falling behind. It should also come as no surprise that student enrolments in STEM based subjects are at an all-time low.

When considering financial literacy, a 2021 Reserve Bank of Australia study found that almost two-thirds of year 12 economics students and around 95 per cent of other year 12 students did not preference an economics course for university. But financial literacy is not just about getting into university to study economics. It's not just about becoming an investment banker. It is about empowering our youth to understand, for example, how they budget, how they manage pay as you go, how they understand whether or not they've been paid the right amount, how they can negotiate a car loan or a home loan and how they can ensure that they don't pay a 24 per cent interest rate on their credit cards. Funding alone is not enough to support this.

So much of Australia's modern economic growth and prosperity depends on the cultivation of STEM skills in our students, and our education system, as it currently stands, is not providing this. Financial literacy is not just for students wishing to pursue an economics career. It is an important social issue that we empower our youth with the ability to manage their own money. The Albanese Labor government has now been in government for a year, and it's time that they look at what they can do to incentivise other governments to provide financial literacy within our curriculum. (Time expired)

Sharon Claydon (Newcastle, Australian Labor Party) Share this | Link to this | Hansard source

The time allotted for this debate has expired. The debate is adjourned and the resumption of the debate will be made an order of the day for the next sitting.