‘I echo the point made by campaigners including Gavin Oldham of The Share Foundation for a system of a default withdrawal policy whereby young people who are registered with HMRC …. could simply be given the money.’
Danny Kruger MP, speaking in the Westminster Hall CTF debate on 19/3/24
Our commentary last week, ‘Putting Dormant Assets to Work’, contained just a brief mention of unclaimed, adult-owned Child Trust Funds (CTFs). This week, in anticipation of a major ITV News programme on Thursday 18th April (starting at 8:30 pm: ‘Claim Your Cash? Britain's Hidden Fortunes: Tonight’), our Thought for the Week focuses on the core of the £2 billion unclaimed, adult-owned CTF problem: how to deal with these unclaimed HMRC-allocated accounts?
The UK Government provided funds for opening a CTF account for every child born in the United Kingdom between 1 September 2002 and 2 January 2011. If the child's parents or guardian had taken no action by their first birthday, HM Revenue & Customs automatically opened the account for them: 28% (1.7 million) were opened this way. In most of these cases, there was no further contact.
When I analysed The Share Centre’s 83,000 HMRC-allocated account base in 2018, I discovered that 86% were either never registered with the family or ‘addressee gone away’. Sure enough, when those young people started turning 18 in 2020, all HMRC-allocated account providers confirmed a high rate of unclaimed accounts. The Share Foundation’s search facility https://findCTF.sharefound.org has reported that 98% of all its successful linkages are with account providers who administer these HMRC-allocated accounts. Meanwhile, the National Audit Office confirmed last year that over half of these accounts belong to young people from the lowest-income families.
Urgent action is therefore required to enable a default CTF pay-out process to be established for these matured accounts, and our commentary this week recounts where we are on that journey.
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We've published over 340 of these weekly commentaries covering a wide range of issues, and you can find links here to the full list over the past six years.