Financial Literacy and Education Commission: Further Progress Needed to Ensure an Effective National Strategy
Published: 2007-04-30T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: The Financial Literacy and Education Improvement Act created, in December 2003, the Financial Literacy and Education Commission. This statement is based on a report issued in December 2006, which responded to the act's mandate that GAO assess the Commission's progress in (1) developing a national strategy; (2) developing a Web site and hotline; and (3) coordinating federal efforts and promoting partnerships among the federal, state, local, nonprofit, and private sectors. To address these objectives, GAO analyzed Commission documents, interviewed its member agencies and private financial literacy organizations, and benchmarked the national strategy against GAO's criteria for such strategies.
section_title: What GAO Found
paragraphs: The National Strategy for Financial Literacy serves as a useful first step in focusing attention on financial literacy, but it is largely descriptive rather than strategic and lacks certain key characteristics that are desirable in a national strategy. The strategy provides a clear purpose, scope, and methodology and comprehensively identifies issues and challenges. However, it does not serve as a plan of action designed to achieve specific goals, and its recommendations are presented as "calls to action" that generally describe existing initiatives and do not include plans for implementation. The strategy also does not fully address some of the desirable characteristics of an effective national strategy that GAO has previously identified. For example, it does not set clear and specific goals and performance measures or milestones, address the resources needed to accomplish these goals, or fully discuss appropriate roles and responsibilities. As a result of these factors, most organizations that GAO spoke with said the strategy was unlikely to have a significant impact on their financial literacy efforts. The Commission has developed a Web site and telephone hotline that offer financial education information provided by numerous federal agencies. The Web site generally serves as an effective portal to existing federal financial literacy sites. Use of the site has grown, and it averaged about 69,000 visits per month from October 2006 through March 2007. The volume of calls to the hotline--which serves as an order line for a free tool kit of federal publications--has been limited. The Commission has not tested the Web site for usability or measured customer satisfaction with it; these are recommended best practices for federal public Web sites. As a result, the Commission does not know if visitors are able to find the information they are looking for efficiently and effectively. The Commission has taken steps to coordinate the financial literacy efforts of federal agencies and has served as a useful focal point for federal activities. However, coordinating federal efforts has been challenging, in part because the Commission must achieve consensus among 20 federal agencies, each with its own viewpoints, programs, and constituencies, and because of the Commission's limited resources. A survey of overlap and duplication and a review of the effectiveness of federal activities relied largely on agencies' self-assessments rather than the independent review of a disinterested party. The Commission has taken steps to promote partnerships with the nonprofit and private sectors through various public meetings, outreach events, and other activities. The involvement of state, local, nonprofit, and private organizations is important in supporting and expanding Commission efforts to increase financial literacy, and our report found that the Commission could benefit from further developing mutually beneficial and lasting partnerships with these entities that will be sustainable over the long term.

section_title: Letter
paragraphs: I appreciate the opportunity to be here today to discuss the federal  government’s role in financial literacy. Ensuring that Americans have the  knowledge and skills to manage their money wisely is a key element in  improving the economic health of our nation in current and future  generations. Financial literacy has become increasingly important in  recent years due to the convergence of a number of economic, policy, and  demographic trends. For example, workers today are increasingly  responsible for managing their own retirement savings—yet at the same  time, the nation’s personal saving rate has fallen dramatically over the past  few decades, and household debt hovers at record high levels. In recent  years, we have issued several products on the federal government’s role in  improving financial literacy. My statement today focuses on the Financial  Literacy and Education Commission, which is comprised of 20 federal  agencies and was created in 2003 by the Financial Literacy and Education  Improvement Act.
Today I will discuss the Commission’s progress in (1) developing an  effective national strategy to promote financial literacy and education; (2)  implementing its Web site, hotline, and multimedia campaign; and (3)  coordinating federal financial literacy efforts and promoting partnerships  among government, nonprofit, and commercial organizations. This  statement is based primarily on our December 2006 report that assessed  the Commission’s effectiveness. In preparing that report, we reviewed the  Financial Literacy Act and analyzed relevant Commission documents,  including the National Strategy for Financial Literacy. We assessed the  national strategy, in part, by benchmarking it against general  characteristics of an effective national strategy we have identified in prior  work. We interviewed representatives of all 20 federal agencies that are  members of the Commission as well as representatives of nonfederal  organizations that address issues of financial literacy. We also gathered  and analyzed data on the content and usage of the Commission’s Web site,  telephone hotline, and publication tool kit. We conducted our work from  January 2006 through November 2006 in accordance with generally  accepted government auditing standards.
The National Strategy for Financial Literacy serves as a useful first step in  focusing attention on financial literacy, but it is largely descriptive rather  than strategic and lacks certain key characteristics that are desirable in a  national strategy. While the strategy comprehensively identifies issues and  challenges related to financial literacy, its recommendations are presented  as “calls to action” that generally describe existing initiatives and do not  include plans for implementation. Further, the strategy only partially  addresses some of the characteristics we previously have identified as  desirable for any effective national strategy. For example, although it  provides a clear purpose, scope, and methodology, it does not go far  enough to establish specific goals and performance measures or  milestones; discuss the resources that would be needed to implement the  strategy; or discuss, assign, or recommend roles and responsibilities for  achieving its mission. As a result, most federal and nonfederal agencies we  interviewed said that the national strategy was unlikely to have a  significant impact on their financial literacy and education efforts. Our  report recommended that the Commission incorporate additional  elements into the national strategy to help measure results and ensure  accountability. In commenting on our report, the Department of the  Treasury (Treasury), in its capacity as chair of the Commission, noted that  the national strategy was the nation’s first such effort and said its calls to  action were appropriately substantive and concrete.
The Commission has developed a Web site and telephone hotline that  offers financial education information from numerous federal agencies.  The site serves as a portal to other federal financial education sites, and  representatives of financial literacy organizations generally told us that the  site served its purpose effectively. Use of the site has been growing, and it  averaged about 69,000 visits monthly from October 2006 through March  2007. The volume of calls to the hotline—which acts as an order line for  free publications—has been limited. For example, it received 526 calls in  March 2007. The Commission has not yet implemented some best  practices recommended for federal public Web sites, such as testing its  site for usability and measuring customer satisfaction. As a result, the  Commission does not know if visitors can readily find the information for  which they are looking. Our report recommended that the Commission  conduct usability tests of and measure customer satisfaction with its Web  site, which the Commission said it will do by the second quarter of 2009.  To fulfill a Financial Literacy Act requirement that the Treasury  Department develop a pilot national public service campaign for financial  literacy and education, the department has contracted with the  Advertising Council to create a campaign designed to improve credit  literacy among young people. The campaign, which is scheduled to be  distributed to media outlets in the third quarter of 2007, will also promote  the Commission’s Web site and telephone hotline.
The Commission has played a role in coordinating federal agencies’  financial literacy efforts and promoting public-private partnerships but has  faced several challenges in these areas. The Commission serves as a single  focal point for federal agencies to come together on the issue of financial  literacy, and several calls to action in the Commission’s national strategy  involve interagency efforts. However, coordinating federal efforts has been  challenging, in part because the Commission must achieve consensus  among 20 federal agencies, each with its own viewpoints, programs, and  constituencies, and because of the Commission’s limited resources.  Further, the Commission’s survey of overlap and duplication and its  review of the effectiveness of federal activities relied largely on agencies’  self-assessments rather than the independent review of a disinterested  party. The Commission has taken some steps to promote partnerships  with the nonprofit and private sectors through various public meetings,  outreach events, and other activities, but the impact of these steps is  unclear. Our report recommended that the Commission expand its current  efforts to cultivate sustainable partnerships with nonprofit and private  entities. We also recommended that the Commission provide for an  independent third party to review for duplication in federal programs and  evaluate the effectiveness of federal activities. Since our report was  issued, the Commission has identified several steps it is taking or plans to  take to address these recommendations, including plans for independent  third-party assessments.
subsections: section_title: Background
paragraphs: According to the Financial Literacy Act, the purpose of the Financial  Literacy and Education Commission is to improve financial literacy and  education through the development of a national strategy to promote  them. The act defines the composition of the Commission—the Secretary  of the Treasury and the heads of 19 other federal departments and  agencies—and allows the President to appoint up to five additional  members. The Commission must hold one public meeting at least every 4  months. It held its first meeting in January 2004 and nine subsequent  meetings, most recently in January 2007.
The act requires the Commission to undertake certain activities, including  (1) developing a national strategy to promote financial literacy and  education for all Americans; (2) establishing a financial education Web site  to provide information about federal financial literacy education programs  and grants; (3) establishing a toll-free hotline; (4) identifying areas of  overlap and duplication among federal activities and coordinating federal  efforts to implement the national strategy; (5) assessing the availability,  utilization, and impact of federal financial literacy and education  materials; and (6) promoting partnerships among federal, state, and local  governments, nonprofit organizations, and private enterprises. The act  requires that the national strategy be reviewed and modified as deemed  necessary at least once a year. It also requires the Secretary of the  Treasury to develop, implement, and conduct a pilot national public  service multimedia campaign to enhance the state of financial literacy and  education in the United States.
The Treasury Department’s Office of Financial Education provides  primary support to the Commission and coordinates its efforts. As of April  2007, the office had assigned the equivalent of about 3 full-time  professional staff to handle work related to the Commission and in the  past also has received assistance from staff detailed from other federal  agencies. The Commission has no independent budget. The act authorized  appropriations to the Commission of amounts necessary to carry out its  work, and for fiscal year 2005 Congress specified that $1 million should be  used for the development and implementation of the national strategy.
section_title: The National Strategy Is Descriptive Rather Than Strategic, Limiting Its Value in Guiding the Nation’s Financial Literacy Efforts
paragraphs: To develop the National Strategy for Financial Literacy, the Commission  formed a national strategy working group of 13 member agencies, issued a  call for public comment in the Federal Register, and held six public  meetings—five organized around the commercial, government, nonprofit,  education, and banking sectors and one for individual consumers.  Although the Financial Literacy Act required the Commission to adopt the  strategy within 18 months of enactment, or June 2005, the strategy was not  publicly released until April 2006. The Commission sought unanimous  consent on the national strategy, and Commission members told us that  the Treasury Department faced a significant challenge in trying to get 20  federal agencies—each with its own mission and point of view—to  unanimously agree to a strategy. A particular source of disagreement  involved whether nonfederal entities should be cited by name as  illustrative examples in the strategy. The Commission ultimately agreed  that it would not name these organizations in the national strategy, but cite  them in a separate document issued by Treasury, called the Quick  Reference Guide to the strategy.
The content of the National Strategy for Financial Literacy largely consists  of a comprehensive overview of issues related to financial literacy and  examples of ongoing initiatives. It describes many major problems and  challenges that relate to financial literacy in the United States, identifies  key subject matter areas and target populations, and describes what it  believes to be illustrations of potentially effective practices in financial  education across a broad spectrum of subjects and sectors. As such, the  strategy represents a useful first step in laying out key issues and  highlighting the need for improved financial literacy. At the same time, as  some representatives of the Commission told us, the strategy is  fundamentally descriptive rather than strategic. It provides information on  disparate issues and initiatives but is limited in presenting a long-term plan  of action for achieving its goal.
Most notably, the strategy’s recommendations are presented as “calls to  action,” defined as concrete steps that should be taken for improving  financial literacy and education. Sixteen of these 26 calls to action are  addressed to federal entities, 5 to private or nonprofit organizations, and 5  to the public. However, many of these calls to action are very general and  do not discuss an implementation strategy, and others describe initiatives  that already exist. For example, one call to action states, “Investors should  take advantage of the wealth of high quality, neutral, and unbiased  information offered free of charge,” but does not lay out a plan for helping  ensure that investors will do so.
We have previously identified a set of desirable characteristics for any  effective national strategy. While national strategies are not required to  contain a single, consistent set of attributes, we found six characteristics  that can offer policymakers and implementing agencies a management  tool to help ensure accountability and more effective results. As shown in  the table below, we found that the National Strategy for Financial Literacy  generally addresses the first of these characteristics and partially  addresses the other five.
The six characteristics we considered follow:    Clear Purpose, Scope, and Methodology. An effective strategy describes  why the strategy was produced, the scope of its coverage, and how it was  developed. The National Strategy for Financial Literacy generally  addresses this characteristic. For example, it cites the legislative mandate  that required the strategy, the overall purpose, and subsidiary goals such  as making it easier for consumers to access financial education materials.  At the time of our review, the strategy did not specifically define “financial  literacy” or “financial education” and we noted that doing so could provide  additional benefit in helping define the scope of the Commission’s work.  In its April 2007 report to Congress, the Commission provided definitions  of these terms that it said would guide its work.
Detailed Discussion of Problems and Risks. A strategy with this  characteristic provides a detailed discussion or definition of the problems  the strategy intends to address, their causes, and the risks of not  addressing them. Based on our review, the National Strategy for Financial  Literacy partially addresses this characteristic. It identifies specific  problems that indicate a need for improved financial literacy and often  discusses the causes of these problems. However, it might benefit further  from a fuller discussion of the long-term risks—to the well-being of  individuals, families, and the broader national economy—that may be  associated with poor financial literacy. As we have reported in the past, a  clear understanding of our nation’s overall financial condition and fiscal  outlook is an indispensable part of true financial literacy. Due to current  demographic trends, rising health care costs, and other factors, the nation  faces the possibility of decades of mounting debt, which left unchecked  will threaten our economic security and adversely affect the quality of life  available to future generations. One element of financial literacy is  ensuring that Americans are aware of these potential developments in  planning for their own financial futures since, for example, we can no  longer assume that current federal entitlement programs will continue  indefinitely in their present form.
Desired Goals, Objectives, Activities and Performance Measures. The  National Strategy for Financial Literacy partially addresses this  characteristic, which deals not only with developing goals and strategies  to achieve them, but also the milestones and outcome measures needed to  gauge results. The strategy does identify key strategic areas and includes  26 calls to action that, although often lacking detail, provide a picture of  the types of activities the strategy recommends. However, in general, the  strategy neither sets clear and specific goals and objectives, nor does it set  priorities or performance measures for assessing progress. Several  stakeholders in the financial literacy community that we spoke with noted  that the strategy would have been more useful if it had set specific  performance measures. The Commission might also have set measurable  goals for changing consumer behavior, such as seeking to reduce the  number of Americans without bank accounts or increase the number  saving for their retirement to a specified figure in the next 5 or 10 years.  Without performance measures or other evaluation mechanisms, the  strategy lacks the means to measure progress and hold relevant players  accountable.
Description of Future Costs and Resources Needed. Effective national  strategies should include discussions of cost, the sources and types of  resources needed, and where those resources should be targeted. The  National Strategy for Financial Literacy discusses, in general terms, the  resources that are available from different sectors and its Quick Reference  Guide provides a list of specific organizations. However, the strategy does  not address fundamental questions about the level and type of resources  that are needed to implement the national strategy. The strategy does little  to acknowledge or discuss how funding limitations could be a challenge to  improving financial literacy and offers little detail on how existing  resources could best be leveraged. Neither does it provide cost estimates  nor does it discuss specifically where resources should be targeted. For  example, it does not identify the sectors or populations most in need of  additional resources. The strategy also might have included more  discussion of how various “tools of government” such as regulation,  standards, and tax incentives might be used to stimulate nonfederal  organizations to use their unique resources to implement the strategy.  Without a clear description of resource needs, policymakers lack  information helpful in allocating resources and directing the strategy’s  implementation.
Organizational Roles, Responsibilities, and Coordination. Effective  national strategies delineate which organizations will implement the  strategy and describe their roles and responsibilities, as well as  mechanisms for coordinating their efforts. The National Strategy for  Financial Literacy partially addresses these issues. For example, it  discusses the involvement of various governmental and nongovernmental  sectors in financial education and identifies in its calls to action which  agencies will or should undertake certain tasks or initiatives. However, the  strategy is not specific about roles and responsibilities and does not  recommend changes in the roles of individual federal agencies. Addressing  these issues more fully is important given our prior work that discussed  the appropriate federal role in financial literacy in relation to other entities  and the potential need to streamline federal efforts in this area. In  addition, the strategy is limited in identifying or promoting specific  processes for coordination and collaboration between sectors and  organizations.
Description of Integration with Other Entities. This characteristic  addresses how a national strategy relates to other federal strategies’ goals,  objectives, and activities. The National Strategy for Financial Literacy does  identify and describe a few plans and initiatives of entities in the federal  and private sectors, and it includes a chapter describing approaches within  other nations and international efforts to improve financial education.  However, the strategy is limited in identifying linkages with these  initiatives, and it does not address how it might integrate with the  overarching plans and strategies of these state, local, and private-sector  entities.
Because the National Strategy for Financial Literacy is more of a  description of the current state of affairs than an action plan for the future,  its effect on public and private entities that conduct financial education  may be limited. We asked several major financial literacy organizations  how the national strategy would affect their own plans and activities, and  the majority said it would have no impact at all. Similarly, few federal  agencies with which we spoke could identify ways in which the national  strategy was guiding their work on financial literacy. Most characterized  the strategy as a description of their existing efforts.
Our report recommended that the Secretary of the Treasury, in concert  with other agency representatives of the Financial Literacy and Education  Commission, incorporate into the national strategy (1) a concrete  definition for financial literacy and education to help define the scope of  the Commission’s work; (2) clear and specific goals and performance  measures that would serve as indicators of the nation’s progress in  improving financial literacy and benchmarks for the Commission; (3)  actions needed to accomplish these goals, so that the strategy serves as a  true implementation plan; (4) a description of the resources required to  help policymakers allocate resources and direct implementation of the  strategy; and (5) a discussion of appropriate roles and responsibilities for  federal agencies and others, to help promote a coordinated and efficient  effort. In commenting on our report, Treasury, in its capacity as chair of  the Commission, noted that the National Strategy for Financial Literacy  was the nation’s first such effort and, as such, was designed to be a  blueprint that provides general direction while allowing diverse entities  the flexibility to participate in enhancing financial education. The  department said that the strategy’s calls to action are appropriately  substantive and concrete—setting out specific issues for discussion,  conferences to be convened, key constituencies, and which Commission  members should be responsible for each task. As noted earlier, in its April  2007 report to Congress, the Commission provided definitions for  “financial literacy” and “financial education” to help guide its work. We  acknowledge that the national strategy represents the nation’s first such  effort, but continue to believe that future iterations of the strategy would  benefit from inclusion of the characteristics cited in our report.
section_title: Web Site and Telephone Hotline Offer Financial Education Information from Federal Agencies
paragraphs: The Financial Literacy Act required the Commission to establish and  maintain a Web site to serve as a clearinghouse and provide a coordinated  point of entry for information about federal financial literacy and  education programs, grants, and materials. With minor exceptions, the  Commission did not create original content for its Web site, which it called  My Money. Instead, the site serves as a portal that consists largely of links  to financial literacy and education Web sites maintained by Commission  member agencies. According to Treasury representatives, the English- language version of the My Money site had more than 290 links as of April  2007, organized around 12 topics. A section on federal financial education  grants was added to the site in October 2006, which includes links to four  grant programs. Many representatives of private and nonprofit financial  literacy initiatives and organizations with whom we spoke were generally  satisfied with the Web site, saying that it provided a clear and useful portal  for consumers to federal financial education materials.
From its inception in October 2004 through March 2007, the My Money  Web site received approximately 1,454,000 visits. The site received an  average of 35,000 visits per month during the first 6 months after its  introduction in October 2004. Use of the site has increased since that time  and reached 78,000 visits in April 2006, when the Commission and the Web  site received publicity associated with the release of the national strategy.  From October 2006 through March 2007, the site averaged about 69,000  visits per month. The number of visits to the My Money Web site has been  roughly comparable to some recently launched private Web sites that  provide financial education. Some representatives of financial literacy  organizations with whom we spoke said the Commission should do more  to promote public awareness of the Web site. Commission representatives,  however, noted to us several steps that have been taken to promote the  site, including, for example, a promotional effort in April 2006 that printed  the My Money Web address on envelopes containing federal benefits and  tax refunds.
However, the Commission has not yet conducted usability tests or  measured customer satisfaction for the My Money Web site. The federal  government’s Web Managers Advisory Council provides guidance to help  federal Web managers implement recommendations and best practices for  their federal sites. The council recommends testing usability and  measuring customer satisfaction to help identify improvements and ensure  that consumers can navigate the sites efficiently and effectively.  Representatives of the General Services Administration (GSA), which  operates the site, acknowledged that these steps are standard best  practices that would be useful in improving the site. They said they had  not yet done so due to competing priorities and a lack of funding.  Without usability testing or measures of customer satisfaction, the  Commission does not know whether the Web site’s content is organized in  a manner that makes sense to the public, or whether the site’s visitors can  readily find the information for which they are looking.
Our report recommended that the Commission (1) conduct usability  testing to measure the quality of visitors’ experience with the site; and (2)  measure customer satisfaction with the site, using whatever tools deemed  appropriate, such as online surveys, focus groups, or e-mail feedback. In  its April 2007 report to Congress, the Commission said it would conduct  usability testing of, and measure customer satisfaction with, its Web site  by the second quarter of 2009.
In addition to a Web site, the Financial Literacy Act also required that the  Commission establish a toll-free telephone number for members of the  public seeking information related to financial literacy. The Commission  launched the telephone hotline, 1-888-My Money, simultaneously with the  My Money Web site in October 2004. The hotline supports both English-  and Spanish-speaking callers. A private contractor operates the hotline’s  call center and GSA’s Federal Citizen Information Center oversees the  operation and covers its cost. According to GSA, the cost of providing  telephone service for the hotline was about $28,000 in fiscal year 2006. The  hotline serves as an order line for obtaining a free financial literacy “tool  kit”—pamphlets and booklets from various federal agencies on topics  such as saving and investing, deposit insurance, and Social Security. The  tool kit is available in English and Spanish versions, and consumers can  also order it via the My Money Web site. The volume of calls to the My  Money telephone hotline has been limited—526 calls in March 2007 and an  average of about 200 calls per month between February 2005 and February  2006.
As part of the national strategy, the Financial Literacy Act required the  Secretary of the Treasury to develop, implement, and conduct a pilot  national public service multimedia campaign to enhance the state of  financial literacy in the United States. The department chose to focus the  multimedia campaign on credit literacy among young adults. It contracted  with the Advertising Council to develop and implement the multimedia  campaign, which is expected to be advertised—using donated air time and  print space—on television and radio, in print, and online. According to  the Commission’s April 2007 report to Congress, the launch of the  campaign is scheduled for the third quarter of 2007.
section_title: The Commission Has Taken Steps to Coordinate Federal Agencies’ Efforts and Promote Partnerships but Faces Challenges
paragraphs: The Financial Literacy Act required that the Commission develop a plan to  improve coordination of federal financial literacy and education activities  and identify areas of overlap and duplication in these activities. The  Commission created a single focal point for federal agencies to come  together on the issue of financial literacy and education. Some  Commission members told us that its meetings—including formal public,  working group, and subcommittee meetings—have helped foster  interagency communication and information sharing that had previously  been lacking. In addition, the Commission’s Web site, hotline, and tool kit  have helped centralize federal financial education resources for  consumers. Further, the national strategy includes a chapter on federal  interagency coordination and several of the strategy’s calls to action  involve interagency efforts, including joint conferences and other  initiatives.
However, the Commission has faced several challenges in coordinating the  efforts of the 20 federal agencies that form the Commission. Each of the  Commission’s participating federal agencies has different missions and  responsibilities and thus different perspectives and points of view on  issues of financial literacy. The agencies also differ in their levels of  responsibility for and expertise on financial literacy and education.  Further, because agencies tend to be protective of their resources, it might  be very difficult to recommend eliminating individual agencies’ programs.  Moreover, the Commission’s ability to coordinate such major structural  change, if it chose to do so, would be constrained by its limited resources  in terms of staff and funding. In addition, the Commission has no legal  authority to compel an agency to take any action, but instead must work  through collaboration and consensus. Given these various constraints, a  Treasury official told us that the Commission saw its role as improving  interagency communication and coordination rather than consolidating  federal financial education programs or fundamentally changing the  existing federal structure.
To meet a requirement of the Financial Literacy Act that the Commission  identify and propose means of eliminating areas of overlap and  duplication, the Commission asked federal agencies to provide  information about their financial literacy activities. After reviewing these  resources, the Commission said it found minimal overlap and duplication  among federal financial literacy programs and did not propose the  elimination of any federal activities. Similarly, to meet a requirement of the  act that it assess the availability, utilization, and impact of federal financial  literacy materials, the Commission asked each agency to evaluate the  effectiveness of its own materials and programs—and reported that each  agency deemed its programs and resources to be effective and worthy of  continuance.
In both cases, we believe that the process lacked the benefit of  independent assessment by a disinterested party. Our report  recommended that the Secretary of the Treasury, in conjunction with the  Commission, provide for an independent third party to carry out the  review of duplication and overlap among federal financial literacy  activities as well as the review of the availability, utilization, and impact of  federal financial literacy materials. In response to these recommendations,  the Commission reported in its April 2007 report to Congress that it would  identify an independent party to conduct assessments on both of these  matters, with the first series of independent assessments to be completed  in 2009.
The Financial Literacy Act also charged the Commission with promoting  partnerships between federal agencies and state and local governments,  nonprofit organizations, and private enterprises. Partnerships between  federal agencies and private sector organizations are widely seen as  essential to making the most efficient use of scarce resources, facilitating  the sharing of best practices among different organizations, and helping  the federal government reach targeted populations via community-based  organizations. Treasury officials have cited several steps the Commission  has taken to promote such partnerships. These have included calls to  action in the Commission’s national strategy that encouraged partnerships;  community outreach and events coordinated by Treasury and other  agencies; and public meetings designed to gather input on the national  strategy from various stakeholders. In general, the private and nonprofit  financial literacy organizations with which we spoke said that these steps  had been useful, but that their relationships with federal agencies and  other entities have changed little overall as a result of the Commission.  Several private and nonprofit national organizations have extensive  networks that they have developed at the community level across the  country, and some of these organizations suggested the Commission could  do more to mobilize these resources as part of a national effort. Some  stakeholders told us they also felt the Commission could do more to  involve state and local governments. Greater collaboration by the  Commission with state and local governments may be particularly  important given the critical role that school districts can play in improving  financial literacy. The Commission might consider how the federal  government can influence or incentivize states or school districts to  include financial education in school curriculums, which many experts  believe is key to improving the nation’s financial literacy.
Given the wide array of state, local, nonprofit, and private organizations  providing financial literacy programs, the involvement of the nonfederal  sectors is important in supporting and expanding Commission efforts to  increase financial literacy. Thus far, the Commission has taken some  helpful steps to promote partnerships, consisting mainly of outreach and  publicity. As the Commission continues to implement its strategy, we  believe it could benefit from further developing mutually beneficial and  lasting partnerships with nonprofit and private entities that will be  sustainable over the long term. Our report recommended that the  Commission consider ways to expand upon current efforts to cultivate  sustainable partnerships with nonprofit and private entities. As part of  these efforts, we recommended that the Commission consider additional  ways that federal agencies could coordinate their efforts with those of  private organizations that have wide networks of resources at the  community level, as well as explore additional ways that the federal  government might encourage and facilitate the efforts of state and local  governments to improve financial literacy. In commenting on our report,  Treasury noted that it had a long history of partnerships with nonfederal  entities and would consult with the Commission about how to work more  closely with the types of organizations described in our report. On April  17, 2007, the Commission held the inaugural meeting of the National  Financial Education Network, which it said was intended to create an  open dialogue and advance financial education at the state and local level.
In conclusion, in the relatively short period since its creation, the  Commission has played a helpful role by serving as a focal point for  federal efforts and making financial literacy a more prominent issue  among the media, policymakers, and consumers. We recognize the  significant challenges confronting the Commission—most notably, the  inherent difficulty of coordinating the efforts of 20 federal agencies. Given  the small number of staff devoted to operating the Commission and the  limited funding it was provided to conduct any new initiatives, we believe  early efforts undertaken by the Commission represent some positive first  steps. At the same time, more progress is needed if we expect the  Commission to have a meaningful impact on improving the nation’s  financial literacy.
Mr. Chairman, this concludes my prepared statement. I would be happy to  answer any questions at this time.
section_title: Contacts and Acknowledgments
paragraphs: For further information on this testimony, please contact Yvonne D. Jones  at (202) 512-8678, or jonesy@gao.gov. Contact points for our Offices of  Congressional Relations and Public Affairs may be found on the last page  of this statement. Individuals making key contributions to this testimony  include Jason Bromberg, Assistant Director; Nima Patel Edwards; Eric E.  Petersen; William R. Chatlos; Emily R. Chalmers; and Linda Rego.
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