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You can find the current article at its original source at http://www.guardian.co.uk/money/2013/may/14/child-trust-funds-money-isas
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| Version 3 | Version 4 |
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| Move to allow transfer of child trust fund money into Isas | Move to allow transfer of child trust fund money into Isas |
| (30 days later) | |
| Parents who hold investments in child trust funds will be able to move the money into junior Isas to chase better returns for their children, under proposals outlined by the government. | Parents who hold investments in child trust funds will be able to move the money into junior Isas to chase better returns for their children, under proposals outlined by the government. |
| Since CTFs were phased out in 2011, parents and the savings industry have lobbied the government to allow the money to be transferred into the junior Isas that superseded them. That market has far more choice and, where the money is held in a savings account, often offers better rates, but more than 6 million children with CTFs have been unable to access it. | Since CTFs were phased out in 2011, parents and the savings industry have lobbied the government to allow the money to be transferred into the junior Isas that superseded them. That market has far more choice and, where the money is held in a savings account, often offers better rates, but more than 6 million children with CTFs have been unable to access it. |
| The government has recommended that the current rules be relaxed so that parents can opt to transfer the £4.8bn now held in CTFs to Isas. As with transfers of adult Isas, the process would be handled by the new account provider, who would request the cash from the existing account. Unlike with adult Isas, all of the funds would need to be transferred and the CTF closed completely. | The government has recommended that the current rules be relaxed so that parents can opt to transfer the £4.8bn now held in CTFs to Isas. As with transfers of adult Isas, the process would be handled by the new account provider, who would request the cash from the existing account. Unlike with adult Isas, all of the funds would need to be transferred and the CTF closed completely. |
| The Treasury said it anticipated that many parents would choose to keep the CTF rather than transferring it, so it would be necessary for providers to continue to offer competitive products to them. | The Treasury said it anticipated that many parents would choose to keep the CTF rather than transferring it, so it would be necessary for providers to continue to offer competitive products to them. |
| It added that it had not ruled out merging the two types of accounts, but that this could lead to problems for CTF providers which did not currently offer Isas. It also highlighted the fact that three-quarters of CTFs are stakeholder accounts offering caps on charges and other features that are not routinely available on junior Isas. | It added that it had not ruled out merging the two types of accounts, but that this could lead to problems for CTF providers which did not currently offer Isas. It also highlighted the fact that three-quarters of CTFs are stakeholder accounts offering caps on charges and other features that are not routinely available on junior Isas. |
| The economic secretary to the Treasury, Sajid Javid said: "The government wants to support parents by ensuring that there are clear and simple ways to save for all children. | The economic secretary to the Treasury, Sajid Javid said: "The government wants to support parents by ensuring that there are clear and simple ways to save for all children. |
| "That is why we introduced Junior Isa in 2011 and why, in the interests of fairness, we are today consulting on how to give the 6.3 million children who have a CTF the option to open one too." | "That is why we introduced Junior Isa in 2011 and why, in the interests of fairness, we are today consulting on how to give the 6.3 million children who have a CTF the option to open one too." |
| Danny Cox, head of financial planning at IFAs Hargreaves Lansdown, said the plans made sense. | Danny Cox, head of financial planning at IFAs Hargreaves Lansdown, said the plans made sense. |
| "This consultation paves the way for children to enjoy better returns on their fledgling investments and for parents to simplify their paperwork; the Treasury should be applauded for recognising the importance of simplifying the savings system for the benefit of consumers," he said. | "This consultation paves the way for children to enjoy better returns on their fledgling investments and for parents to simplify their paperwork; the Treasury should be applauded for recognising the importance of simplifying the savings system for the benefit of consumers," he said. |
| "At the moment this two tier system is unsatisfactory for those who have CTFs but want the wider choice of a Junior Isa." | "At the moment this two tier system is unsatisfactory for those who have CTFs but want the wider choice of a Junior Isa." |
| CTFs were a Labour initiative to promote saving and were available to children born between 1 September 2002 and 2 January 2011, with the government initially providing a starting voucher of £250. That was reduced to £50 as the accounts were phased out for new savers, before being replaced with Junior Isas. | CTFs were a Labour initiative to promote saving and were available to children born between 1 September 2002 and 2 January 2011, with the government initially providing a starting voucher of £250. That was reduced to £50 as the accounts were phased out for new savers, before being replaced with Junior Isas. |
| Top savings accounts | Top savings accounts |
| Yorkshire BS | Yorkshire BS |
| Teachers BS | |
| Coventry BS | Coventry BS |
| Powered by MoneySupermarket for the Guardian | Powered by MoneySupermarket for the Guardian |