Lib Dems accuse government of “alarming complacency”

Vincent Cable, the party’s economics spokesman, said that the four-fold increase in the amount of young bankrupts since 2001 showed a “pressing need” for financial education.

“There is now a pressing need for better financial education for the young. This generation of young people face an unprecedented burden of debt which is going to affect their ability to buy homes, start families and save for old age,” said Mr Cable.

“The government has shown alarming complacency on this issue,” he added, calling for action to increase financial awareness and a clamp down on “irresponsible behaviour”.

His comments come as the amount of bankruptcies amongst 18 to 29-year-olds have risen from 1,681 in 2001-02 to 6,520 in 2004-05.

Fellow Lib Dem MP Jenny Willott agreed that there were “serious financial problems” affecting young people, particularly due to student debt.

She urged ministers not to “shut their eyes” to the problems but to do something to tackle debt and bankruptcy among the young.