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Children living in the UK should be taught how best to borrow money and avoid a spiral of debt management problems, according to the Archbishop of Canterbury Dr Rowan Williams.

The archbishop addressed the House of Lords recently and insisted that the government needs to act to make sure that children from poor backgrounds do not follow in the footsteps of their heavily indebted parents.

Financial education can play a major role in steering young people away from borrowing irresponsibly but there are very few schools where such lessons are conducted, Dr Williams claimed.

"Young people are vulnerable to considerable pressure – sometimes from banks themselves – to embark on risky and costly ventures into borrowing," said the archbishop.

"They need skills in assessing risks, in interpreting borrowing conditions," he added.

A report from Abbey Banking recently revealed that more than one in five British children aged between 11 and 15 are afraid of being poor and facing serious debt problems in later life.

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