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Child Trust Funds

Volume 487: debated on Monday 2 February 2009

To ask the Chancellor of the Exchequer what types of child trust funds each provider offers; and under what brand names each provider offers each type. (253376)

A table of the types of child trust fund offered by each provider can be found on the child trust fund website at the following address:

http://www.childtrustfund.gov.uk/templates/Page_1246.aspx

The names of the child trust funds offered by each provider can be found on the relevant provider websites links to which are available on the child trust fund website at the following address:

http://www.childtrustfund.gov.uk/templates/Page_1243.aspx

To ask the Chancellor of the Exchequer (1) which child trust fund (a) type and (b) provider has had (i) the largest return in percentage terms since being established and (ii) the largest increase in value in a single year; (253377)

(2) which child trust fund (a) type and (b) provider has had (i) the lowest return in percentage terms since being established and (ii) the lowest increase in value in a single year;

(3) what plans he has to assess the child trust funds available from each provider in respect of their comparative performance; and if he will publish the increase made in value by each fund in each year;

(4) how many and what proportion of child trust funds have been transferred under (a) section 7(a) and (b) section 7(b) of the Child Trust Fund Act 2004 in each year since their inception; and if he will make a statement.

To ask the Chancellor of the Exchequer what assessment he has made of the effect of the economic downturn on the likely performance of child trust funds; and if he will make a statement. (253380)

Child trust funds are a long-term investment over an 18-year period, with the first accounts reaching maturity in 2020. Parents can choose which type of CTF account their child’s money is invested in, and can transfer between account types at any time. Three types of child trust fund accounts are available. Stakeholder accounts and shares accounts invest in stocks and shares, while the savings account does not. Although shares can go down as well as up in value, particularly in the short-term, the historical evidence is that they tend to provide a better return than cash for long-term investments. Also, with CTF stakeholder accounts, the level of exposure to shares will decrease over time as money in the account is gradually moved into more cash-like investments after the child turns 13. This ‘lifestyling’ element will help to reduce risk before maturity.

To ask the Chancellor of the Exchequer how many and what percentage of child trust funds opened under (a) section 5 and (b) section 6 of the Child Trust Fund Act 2004 in each year since their inception; and if he will make a statement. (253382)

This information is available in table 2 of the Child Trust Fund Statistical Report 2008 which can be found at the following address:

http://www.hmrc.gov.uk/ctf/statistical-report-2008.pdf

To ask the Chancellor of the Exchequer what his estimate is of the number and percentage of eligible children who have not had a child trust fund opened on their behalf in each year since their inception; and if he will make a statement. (253383)

Every eligible child has had a Child Trust Fund account opened for them. If the account opening voucher is not used by the child’s parents then the Government set up an account on behalf of the child.

To ask the Chancellor of the Exchequer (1) what the total monetary value was of all child trust funds in each year since their inception; and how many such funds there were in each year; (253385)

(2) how many and what percentage of child trust funds have received contributions and subscriptions other than (a) those specified in sections 8 to 10 of the Child Trust Fund Act 2004 and (b) those resulting from the growth in value of the child trust fund.

This information is available in table 3 of each year’s Child Trust Fund Statistical Report which can all be found at the following address:

http://www.hmrc.gov.uk/ctf/stats.htm