For over a decade, the United Kingdom has conspicuously avoided an international examination of its young people's grasp of money matters. While proudly proclaiming its status as a global financial hub, the nation has opted out of the Organisation for Economic Co-operation and Development's (OECD) Programme for International Student Assessment (PISA) financial literacy tests for four consecutive rounds since they began in 2012.
The Cost of Not Measuring
Professor Michael Mainelli, Chairman of the Z/Yen Group and former Lord Mayor of the City of London, draws a sharp comparison. He likens the UK's stance to that of an "education bore" at a party who claims they could have been a professional "but just couldn't be bothered to take the test." The fundamental principle, he stresses, is that you cannot manage what you refuse to measure. The UK's commitment to evidence-based policy appears to waver precisely when the evidence might prove awkward.
The implications of this gap in knowledge are profound. Financial literacy extends far beyond personal responsibility; it is a critical pillar for societal stability and economic growth. When households fail to comprehend concepts like compound interest, inflation, or financial risk, they do not merely make poor choices for themselves. Their collective decisions can amplify systemic problems, leading to mispriced mortgages, underfunded retirements, and speculative losses that ultimately strain public resources.
A Glimmer of Hope and a London Initiative
There is, however, a sign of potential change. On 5 November, the UK Government published its Financial Inclusion Strategy. Within it is a commitment to "exploring options such as participating in the OECD PISA 2029 Financial Literacy Assessment." This move, which Professor Mainelli describes as "to be applauded," could finally provide a robust, internationally comparable benchmark for the financial capability of young people in England.
In parallel, private initiatives are seeking to fill the educational void. City AM and City Pay It Forward have launched their YearSixDividend programme. This ambitious project aims to deliver free, high-quality financial education to every Year Six child in London. If sustained, this initiative would give pupils in the capital a significant five-year head start in preparation for any future PISA assessment.
Why Benchmarking Matters for a Financial Capital
The contradiction at the heart of the UK's position is stark. London markets itself relentlessly as a pre-eminent global financial centre, a fintech innovator, and a thought leader in regulation. Yet, by abstaining from international benchmarking while exporting financial services worldwide, it risks appearing like a restaurant claiming Michelin-star status while refusing to let anyone inspect its kitchen.
Professor Mainelli argues that the potential for embarrassment is precisely the point. A poor score would not be a national humiliation but actionable intelligence for policymakers. It would establish a much-needed baseline, something rarer and more valuable than optimism, from which to build effective strategies. Pretending the population understands pensions because Premium Bonds were once popular is not a viable strategy for the 21st century.
Ultimately, the OECD test is more than a school exam; it is a stress test for society's financial resilience. Financial systems only function when people trust they are navigable and fair, not rigged casinos. Participating in the test signals a government's acceptance of responsibility for making financial rules intelligible to all citizens, not just to graduates of specific disciplines.
UK exceptionalism is not a substitute for competence, and sovereignty does not magically confer numeracy. Taking the OECD financial literacy test will not instantly solve Britain's financial challenges, but it will provide the essential data to ensure the population is equipped with the skills to tackle them. Continuing to refuse participation, as Professor Mainelli concludes, strongly suggests we already know the answer—and simply do not like it.
