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Ann McKechin MP today welcomed figures released by HM Revenue and Customs which show hundreds of parents in Glasgow North have been opening up a Child Trust Fund account. They show that 2,428 accounts have been opened in Glasgow North constituency alone, with 64% being opened directly by parents and a further 881 accounts opened by the Government on behalf of children here.
Across the city, 26,435 savings accounts have been opened to date. Ann said:  "I'm pleased to see that many parents and families in Glasgow North are taking full advantage of the chance to invest in their child's future, with the help of the Government.
"Families around the country have received a £250 boost to kick start their child's savings as a result of the Labour Government's Child Trust Fund scheme, with a further £250 for children in low income families.
"The vouchers go straight to parents of a child, meaning the incentive to open an account and start saving for the child's future is very strong."
The Government introduced the Child Trust Fund (CTF) in April 2005. When a child is born, a CTF voucher for £250 is sent to parents automatically once they have claimed Child Benefit. If a child is in a lower-income family they will also receive an additional £250 (this will go to children in families eligible for full Child Tax Credit – those with a household income of £16,040 or below in 2009/10). It was backdated to cover all children born from 1 September 2002 onwards. Children who reach the age of 7 from 1 September this year will receive the second round of Government payments – as announced in Budget 2006. At the age of 7, each child will receive a further £250 payment from the Government. Again, children in lower-income families and children in care will receive an additional £250. Age 7 payments are paid directly into the Child Trust Fund account by HMRC. When children reach the age of 16, they take control of accounts, allowing them to invest the money as they wish. The money is locked in until they reach 18. There are no restrictions on the use of the money at 18 - young people are best placed to decide on use. The Government has announced that Child Trust Funds will be able to roll over into an ISA on maturity, enabling young people to continue to save tax-free. The Government also provides an extra £100 per year for every child who spends the year in care, in order that their Child Trust Fund provides a more significant asset for them to access on entering adult life. At Budget 2009, the Government announced that it will contribute an additional £100 per year to the Child Trust Fund accounts of all disabled children, with severely disabled children receiving £200 per year. Payments will start in April 2010 for children with a CTF account.
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