Child Trust Funds

So Osborne and Laws, the dynamic duo at the Treasury have announced plans to knock Child Trust Funds (CTF) on the head.

For those who don’t know CTF are savings accounts set up to provide a cash fund when a child reaches 18. The Government puts in £250 when a child is born. When the child reaches 7 then the Government shells out some more cash. Parents and relatives are encouraged to add money when they can afford it.

For some it seems a good deal – providing a handy nest egg for University or house buying. Others deride it as giving money away to the poor and undeserving.

Ian Cowie in the Telegraph is certain that pulling the plug on the CTF was the right thing to do.

Here and now, unpopular though it may be to scrap the CTF, it is undoubtedly the right thing to do at this stage of the credit crisis. The reason is that these payments were gifts from a government up to its neck in debt. This scheme was an egregious example of Gordon Brown’s Great Debt Delusion.

And Kate Green MP, a chief executive of the Child Poverty Action Group explains the vindictive nature of the cut in Child Trust Funds.

This is just the sort of mean-spirited, below the radar cut we can expect to get used to now. Young people wouldn’t actually have received the money in their Child Trust Fund till they reach age 18 – so today even the first potential recipients won’t yet have reached their teens. By the time families notice what they’ve lost, the blame that attaches to George Osborne for this ungenerous decision will have been long forgotten. But for two parties that have made such play of improving social mobility, this is a cynical step.

As for me I’m with George Osborne! Although not for the same reasons.

About 20% of the UK population is below 18. Over that 18 years stretch the Government will be pumping in £500 a child, plus whatever other voluntary contributions the parents and relatives can afford. In Government giving it will be about £330M a year.

That’s £330M+ a year that’s going to the banking system, the very same system that treats the working man as nothing more than a trust fund to allow them to play super casinos. We’ve seen how they’ve raided the working man’s pension funds, reducing the benefits yet maintaining their fees. On the basis that we’re funding a wretched, corrupt and immoral financial capitalist system should be enough for it never to have got off the ground. These bankers will be benefiting more from this influx of cash more then our children ever will.

Why we can’t create a world where everyone has the same opportunities, where everyone is equal, where the state is a servant of the people, where greed is frowned upon, where a harm to a neighbour is a harm to all? A world where your potential isn’t engrained by where you live, what your parents do or what school you went to! I despair when I see our Government buying into this capitalist system and entrenching it into our daily lives.

A new world is possible.

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