The government has published its Financial Inclusion Strategy in order to tackle the barriers to individuals’ and households’ financial inclusion.
The strategy includes a commitment to increasing levels of emergency savings. It builds on Nest Insight’s research and the launch of a National Coalition of Employers, co-led by Nest Insight, aimed at driving take up of workplace savings schemes.
The strategy highlights gathered evidence on the topic, showing that opt-out payroll savings arrangements can support working people to save, build a financial cushion, and complement auto-enrolled pension saving.
Lucy Rigby MP, economic secretary to the Treasury, said: “We are focused on removing barriers and unlocking opportunity for people across the UK. This starts by equipping our young people with the tools they need to begin their financial lives. By making financial education a compulsory part of the primary school curriculum, we will ensure that children are supported to develop healthy attitudes to money at an early age. This represents a key intervention to build financial skills and confidence and will help young people navigate the financial system as they get older.
“This Financial Inclusion Strategy has been developed with the support of a financial inclusion committee of consumer and industry representatives. I am very grateful to them, and the wide range of stakeholders who have given their time and expertise to inform the strategy. This strategy sets out an ambitious programme of action to drive financial inclusion across the UK. I look forward to seeing the change that we can deliver by working together.”
Will Sandbrook, managing director of Nest Insight, added: “Nest Insight strongly welcomes the centrality of workplace emergency savings in the government’s new Financial Inclusion Strategy. Not only are opt-out payroll savings effective, they are also inclusive. A growing body of evidence shows that managing life without the peace of mind and sense of control that a savings buffer gives takes a real toll, which can be harmful to people’s mental health and their relationships.
“We look forward to supporting the new National Coalition of Employers alongside the Money and Pensions Service and The Investing and Saving Alliance (TISA) to scale up workplace savings and help people build lifelong financial security.”
Carol Knight, chief executive officer of TISA, said: “As an organisation that champions the interests of all consumers, we particularly welcome the measures aimed at helping people going through trauma, including domestic abuse, marital breakdown and homelessness. We further welcome the measures to make it easier for employers to support workers by diverting some of the earnings into savings, reducing the risk of it being swept away in the pressures of everyday budgeting. TISA is delighted to be part of bringing together a national coalition of employers to encourage this move and contribute to delivering a truly inclusive financial system.”
Emily Trant, chief impact officer at Stream, added: “The government’s new financial inclusion strategy marks an important step towards helping more people build lasting financial resilience. By bringing together employers, lenders, and innovators, it recognises that practical, everyday mechanisms can make a real difference to how people manage and feel about their money.”
