Teachers are being told to put pupils on a new personal finance course amid fears the public's ability to manage spiralling debt has reached crisis point.

All schools are being urged to sit teenagers aged between 14 and 16 for the new qualification, which will be offered from September.

Business leaders welcomed the move as a step in the right direction but called on the Government to go further and make personal finance tuition compulsory.

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The new course, to be offered at foundation and intermediate level, will culminate in a practical test to assess pupils' money-management skills.

Its national roll-out follows a campaign launched by The Birmingham Post last year which called on Ministers to make personal finance mandatory in schools. Consumer debt in the UK crossed the £1 trillion mark last year, sparking fears the "buy now, pay later" culture is starting to threaten economic stability.

This September will see universities triple the amount they charge students as Ministers insist more young people should attend higher education.

Meanwhile, spiralling house prices have put property beyond the reach of many, not least students who are set to be saddled with debts of up to £34,000 by 2010, according to Barclays Bank.

Gavin Shreeve, chief executive of the Institute of Financial Services which created the course, said: "Financial literacy in the UK is at crisis point with consumer debt hitting more than £1 trillion in 2005.

"The introduction of the IFS level one and two qualifications could not have come at a better time."

Sir Digby Jones, director general of the CBI, said: "We have got to ensure that young people go into the world of work in the 21st century equipped with the skills that are relevant to a competitive, global economy."

He claimed financial literacy, including knowing how to operate a bank account and borrow and save, was a vital part of that.

Tony Blair ruled out making the subject mandatory when confronted by The Birmingham Post during a visit to a specialist business school in Birmingham last year. He said: "I don't think we should put further obligations on schools."

The Qualification and Curriculum Authority, which has given the green light for the course, said: "We don't want to make too many rules about you must do this or you must do that. But we see value in this, which is why we have credited the qualification."