Charities urge government to secure savings accounts for children in care
Barnardo’s and Action for Children are stepping up efforts to secure a government-funded savings account for children in care.
Child trust funds, introduced under the Labour government, were abolished from January, saving the government £500m per year. The accounts were available to all children in the UK and matured when the child reached 18.
The Treasury has now proposed to replace the funds with a voluntary ISA scheme for parents, but charities have warned that this replacement will exclude looked-after children.
Action for Children and Barnardo’s are calling on government to create an account of £250 for any child who enters the care system for a minimum of 13 weeks.
Dame Clare Tickell, chief executive of Action for Children, said: “It adds insult to injury for children who cannot live with their parents to then lose out on a few hundred pounds that would make a huge difference to them and help ease their lives into adulthood.
“We owe it to them to make sure that they, like many of those who are not in care, have savings that help them to plan their future and stand on their own two feet as adults.”
The charities’ joint proposal states that after the initial £250 payment, councils must notify HM Revenue and Customs if the child spends more than 26 weeks of the next year in care. HMRC would then add a further £100 to the account, repeated for each subsequent year.
Barnardo’s chief executive Anne Marie Carrie said: “We’re not talking about a lot of money here. These children have been through so much instability and emotional turmoil that they are placed firmly at the bottom of the pile almost by default.
“They would only be supplied with a few hundred pounds, but we must remember most of these children have left the care system with nothing. The government as their corporate parent has a moral obligation to ensure that when these young people are making that huge transition from child to adult, often alone, they have as many of the same chances as any other 18-year-old as possible.”
The charities’ proposal follows similar concerns raised by the Institute for Public Policy and Research at the end of last year, which said that millions of vulnerable children will lose a vital nest egg for the future.