Finance Minister Michael McGrath has announced the development of a National Financial Literacy Strategy in Ireland. This strategy aims to identify areas where people might need assistance in managing their finances. The decision to implement this strategy comes in light of a report by the Competition and Consumer Protection Commission (CCPC), which revealed that one-third of people in Ireland are struggling financially. Additionally, 12% of respondents admitted that they would only be able to cover their costs for a month if faced with an economic shock.
Despite these challenges, the report found that Irish people’s financial literacy is relatively high compared to other countries. The CCPC used the Organisation for Economic Co-operation and Development (OECD) measure, which scores people’s financial literacy between zero and 20. Irish respondents scored an average of 14.0, while the OECD average in 2020 was 12.7. Hong Kong, China had the highest average score of 14.8, while Italy had the lowest comparable country average score of 11.1.
Minister McGrath emphasized the need for an overall financial literacy strategy that brings together the efforts of both public and private bodies. He expressed his personal interest in this area and highlighted the societal and individual benefits of strong financial literacy skills. The initial phases of the strategy’s development will involve mapping exercises to gather evidence and analyze the financial literacy levels and well-being of the population. The aim is to gather information on the existence of and access to financial literacy programs, review good practices, research, and literature, and identify operational and replicable practices.
To ensure a comprehensive strategy, the Department of Finance will also engage with international peers who have already implemented similar strategies. This will allow Ireland to learn from their experiences and incorporate successful approaches into their own framework. Additionally, the strategy will focus on identifying areas of financial literacy gaps that need to be addressed and determining possible target audiences for interventions.
The development of a National Financial Literacy Strategy is a positive step towards improving the financial well-being of the Irish population. By addressing areas of need and providing targeted interventions, the strategy aims to empower individuals to make informed financial decisions and improve their overall financial health. It is hoped that this initiative will contribute to a more financially literate society in Ireland, ultimately leading to greater financial stability and resilience for all.