A “lost generation” of mathematicians has cost the economy £9 billion, while GCSE maths has become a “pick ‘n’ mix” test rather than the key staging post it once was, according to a report.

The decline in standards threatens the future of the economy, say the authors, and is having a devastating impact on the City, with some firms recruiting most of their maths graduates from overseas.

The report, by the Reform think-tank, accuses the Government of marginalising the interests of employers, teachers and students. It claims that ministers are focusing on exam results, rather than educational outcomes, and are trying to get pupils to pass any five GCSEs to meet targets, rather than concentrating on the core subjects of English and maths.

A culture shift is needed so that people no longer boast about their lack of maths skills but are instead embarrassed, the authors say. “The UK remains one of the few advanced nations where it is socially acceptable, fashionable even, to profess an inability to cope with maths,” they add. “Society needs to build on its new interest in maths-based puzzles such as Su Doku to expel the myths about maths and change the image of the subject from geek to chic.”

Holders of an A level in maths earn, on average, 10 per cent more, or £136,000, over a lifetime than those without it, Reform claims. About 440,000 people have been put off taking A-level maths since 1989, at a cost to the economy of £9 billion.

Explaining this downturn, the report said: “Concerns over poor teaching in the 1970s led to a massive extension of government involvement in the subject since the mid-1980s.

“The unintended consequence has been demotivation of teachers, less enjoyment on the part of students and the distancing of employers and universities from education policy.” The highest maths achievers are “at the pinnacle of the City hierarchy, making them the new ‘masters of the Universe’ ”, the report said, but these are increasingly recruited abroad. China and India are producing hundreds of thousands of science and maths graduates each year.

Maths exams are much easier now than 30 years ago, Reform says, because of efforts to make them more relevant to the workplace. This means that children are not being taught key skills such as problem solving. As a result, it is “now possible to achieve a grade C in GCSE maths having almost no conceptual knowledge of mathematics” and by scoring less than 20 per cent in the top paper.

“A coherent discipline has changed to ‘pick ‘n’ mix’, with pupils being trained to answer specific shallow questions on a range of topics where marks can be most easily harvested.”

The report calls for independence of the examination system and a reversal of the trend towards modularisation.

David Laws, the Liberal Democrat Shadow Schools Secretary, said: “Our education system is too often failing to get the basics right, which risks damaging the national economy.”

Jim Knight, the Schools Minister, said: “GCSE and A-level maths are rigorous qualifications. Standards are carefully monitored by a watchdog, which is independent of ministers, and they tell us maths is a nationally important priority.”

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