Almost a million young people have yet to access savings contained in Child Trust
Funds (CTFs), according to a report by Parliament's Public Accounts Committee
(PAC).
The PAC said over £1.7 billion is waiting to be claimed by a million young
adults, at an average value of £1,900 each.
It says 'failure in long-term planning' by HMRC means 42% of eligible
18-20-year-olds have not drawn on their savings.
The PAC says that given CTFs are not reaching many of the people they were
designed to help, HMRC should be doing more to find and contact young people who
have not claimed their savings.
According to the PAC, many young adults don't know about their savings or have
lost track of them. It found that CTF providers are charging fees for passively
managing accounts but are not doing enough to link these accounts to their
owners.
Dame Meg Hillier MP, Chair of the PAC, said:
'The aims behind CTFs are laudable - for young people to come into a pot of
money on reaching 18, with the promotion of financial literacy and good
savings habits. But many young people are unaware that they have money
waiting to be claimed.
'In an ongoing cost of living crisis, our young people need every bit of
support we can give them. HMRC still has time to make sure that CTFs are
given the chance to be the boost to young people's futures which they were
designed to be.'
Internet link: Parliament website