Financial education is to become compulsory in secondary schools for the first time, following changes announced in the new draft National Curriculum for England.

The new curriculum will see financial education embedded in both maths and in citizenship classes, making financial capability a statutory part of the curriculum for the first time. It will come into effect in September 2014.

At key stage 3, children aged between 11 and 14 will be taught about the functions and uses of money, the importance of personal budgeting, money management and a range of financial products and services.

At key stage 4, pupils aged between 14 and 16 will learn about wages, taxes, credit, debt, financial risk and a range of more sophisticated financial products and services.

Key stage 3 maths students will be expected to solve and devise problems in financial maths and understand simple interest.

The financial education charity Personal Finance Education Group (pfeg) which has been leading a campaign pushing for more financial education in schools, described the government's latest announcement as a 'huge victory'.

Tracey Bleakley, pfeg chief executive, said: 'Financial education is essential in equipping young people with the knowledge, skills and confidence they need to be able to manage their money well. The campaign has been supported by teachers, parents, young people and more than 250 MPs and peers of all parties. Today's news is a big leap forward for our ultimate goal of ensuring that financial education is taught in every school in the UK.'