The Government has formed a taskforce comprising major banks and financial institutions to address the issue of £1.6 billion in unclaimed savings held in Child Trust Fund accounts. Nationwide, HSBC UK, Sheffield Mutual, Yorkshire Building Society, and several other providers have signed up to the initiative, which aims to reconnect approximately 750,000 young savers with their funds.
Taskforce Aims to Overcome Barriers
The taskforce is scheduled to meet for the first time with the goal of encouraging more young people to claim their matured Child Trust Fund accounts. These accounts hold an average of £2,200 each. Only the child for whom the account was originally opened can access the funds upon turning 18, leading many to either forget about the account or struggle to locate it. The taskforce will coordinate efforts among providers to address practical barriers that hinder claims.
Background on Child Trust Funds
Child Trust Fund accounts were long-term, tax-free savings accounts established for children born in the UK between 1 September 2002 and 2 January 2011. The Government made an initial deposit, and parents could contribute up to £9,000 annually. For those whose parents maximised contributions, the account could hold over £160,000 by the time the child turned 18. Account holders could manage their accounts from age 16 but could only withdraw funds after turning 18. The oldest eligible individuals are now 24, meaning some savings have been untouched for six years.
Government and Industry Reactions
Rachel Blake, Economic Secretary to the Treasury, stated: “Too many young people are missing out simply because they are not aware of where their Child Trust Fund is or how to access it. We are acting to fix that by bringing government and industry together - improving coordination and making it easier for people to find and claim what's rightfully theirs.”
JP Marks, HMRC's Chief Executive and First Permanent Secretary, added: “Many young people have Child Trust Fund accounts with an average £2,200 waiting to be claimed. This is their money, and we want to do all we can to help them find and access it. If you think you have one, you can use the 'Find my Child Trust Fund' tool on GOV.UK to find out where your account is held.”
Bank Commitments
Richard Stocker, Head of Savings at Nationwide, commented: “Nationwide is pleased to be part of the Child Trust Fund taskforce and fully supports its aims. We remain committed to working collaboratively across the industry to build on the progress made so far and deliver a meaningful outcome on this important issue.”
Philip Kurtenbach, Head of Product Management & Governance, Wealth & PB at HSBC UK, said: “At HSBC UK, we're committed to putting customers at the heart of everything we do. We know that having a fund to support young people as they start adult life can make a real difference - opening up opportunities at a pivotal moment in their lives. That's why we're supporting the HMT Taskforce as the industry comes together to ensure the funds reach those they were intended for.”
How to Claim
HMRC offers a free 'Find your Child Trust Fund' tool on its website, allowing individuals to check if they or their child have an account. The claim process is straightforward and can be completed without external assistance.
