Child Trust Fund reforms to simplify access

Young people who lack the mental capacity to manage financial decisions will soon find it easier to access their savings, thanks to new government reforms aimed at rectifying a long-standing injustice. These changes will simplify the intricate and often lengthy Court of Protection process, which has caused unnecessary stress for families. Under the new legislation, parents and guardians will be able to approach Child Trust Fund providers directly to access the savings set aside for an estimated 63,000 to 126,000 young adults.

Introduced in 2005 to support children financially as they move into adulthood, the Child Trust Fund scheme failed to cater for those who turned 18 but were unable to make competent financial decisions. Justice Minister, Jake Richards shared, “Young people who lack the mental capacity to make financial decisions should be able to access their savings as easily as possible – especially when this money was put aside by loved ones to help them take their first steps into adulthood.” He added, “This is simply an injustice that we're finally putting right and as campaigners have argued for years, change is long overdue.”

The government has indicated that collaboration with campaigners, disability charities, and financial services will be vital in developing the new process. Economic Secretary to the Treasury, Rt Hon Lucy Rigby KC MP, expressed enthusiasm about the forthcoming changes, saying, “The changes that we’re introducing will help tens of thousands more young people to connect with their Child Trust Funds – worth on average £2,600 each.” She remarked, “I’m so pleased that we will finally ending this long-standing injustice and I’m grateful to everyone who has worked with us to make this happen.”

As the government sets about amending the Financial Services and Markets Bill to enshrine these reforms, stakeholders will consider how the new system should operate, including access criteria and necessary safeguards for those lacking mental capacity. While the forthcoming changes will simplify access, the Court of Protection will still remain available for adults who require more stringent measures to protect their financial interests.

Anna Bird, CEO of Contact, praised the government’s commitment to legislative change, asserting, “We warmly welcome the government’s commitment to legislate for a simpler way for young disabled people to access savings in Child Trust Funds.” Bird noted the essential support of campaigners like Andrew Turner, stating, “For too long, tens of thousands of young disabled people and their families have faced a complicated and costly process to access money that rightfully belongs to them.”

Turner, a parent campaigner, described the developments as, “This bold move from the government is extremely positive news for tens of thousands of young people who have been locked out of their Child Trust Fund savings.” He continued, “A simpler process for accessing these savings will release millions of pounds of benefit and help reduce the administrative burden on parents supporting a disabled child.”

With a commitment to turning this vision into reality, the government looks forward to working with families and financial providers to ensure a more practical and compassionate system for those who need it most.