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Autumn 2003 Newsletter

Silver spoon?

The Spring Budget introduced the idea of the "Child Trust Fund", which is intended to provide children with an endowment of £250 at birth. Since the announcement, there has been very little further detail - the Revenue are the Treasury are working on the details. Accounts are not expected to be available until 2005, but presumably they will then be backdated for all those children born from the start-date in September 2002.

The initial plan is that up to £1,000 can be added to the fund each year by family and friends. The fund cannot be accessed until the child is 18. A cynic might say that the fund should then be large enough to pay whatever the universities are charging at that time, but it still promises to be a good way to save up for that "start in life".

Unfortunately, as the tax credit system has shown, it's not easy for the Revenue to administer such a universal benefit. There's a lot of paper involved. It remains to be seen whether this makes a real difference to child poverty, as the Chancellor promised, or whether it only makes an eye-catching headline.