BBC
Latonya only learned she had a Child Trust fund when a tutor at her university told her about the project.
Latonya Skye-Paterson didn’t know a child trust fund had been set up for her until her guardian suggested she check online.
“I found out I had £955 in there, which is a lot. A lot more than I expected… it’s helped me so much,” she said.
New figures suggest £1.4 billion belonging to 728,000 people is ready to be claimed now they are 18 – but many are unaware these accounts exist, according to a charity which traces lost funds.
Now a senior MP is backing calls for payments to be made automatically for some of these accounts – a plan the government says would be complex and costly.
Latonya, 20, is one of 6.3 million people born between September 2002 and January 2011 who benefited from a children’s trust fund launched by a payment, usually £250, from the Government.
The idea was that the tax-free long-term savings pot would increase in value before their 18th birthday.
The average amount of children’s trust funds is estimated to be around £2,000 due to growth over the years and additional money invested by family and friends.
But like hundreds of thousands of other people, when Latonya turned 18, she had no idea her fund existed.
The Share Foundation, a charity that helps people trace lost and unclaimed funds, calls for automatic payment of some of these funds if they have not been claimed by the time account holders turn 21.
“I think it’s a great plan to be honest,” Latonya said. “My tutor told me about it, but my brother is a year older and went to the same university and he wasn’t told about it, so it’s chance who knows, who tells who.
“Especially with the cost of living, getting it automatically when you didn’t know you had it could really give people the break they need.”
Latonya, pictured here with her grandparents shortly after her birth, says her family lost track of their children’s trust fund because her father was in the military so they moved around a lot when she was young.
This “Default Withdrawal at Age 21” plan covers accounts where no action has been taken by parents or guardians to create a trust fund after receiving the initial government bond.
These “lost” funds are called “HMRC allocated accounts” and include 449,000 accounts holding £927 million.
These are the funds that activists are calling for to be automatically paid to account holders using Social Security numbers if they are not claimed before people turn 21.
National Insurance numbers could be used to trace account holders via PAYE payslips, student loans or benefits.
‘Treasure’
Sir Geoffrey Clifton-Brown is an MP who also chairs Parliament’s Public Accounts Committee.
Speaking as an MP, he told Radio 4’s Money Box that he supported the idea of automatic payment.
“I kind of liken this money to a treasure buried on a (desert) island in the middle of vast acres of sand, waiting for the poor beneficiaries of these children’s trust funds to go get that money,” he said.
“I think we could do a lot more to encourage the government to find the recipients.”
Sir Geoffrey said he would put pressure on the Treasury and HMRC the next time they appeared before the Public Accounts Committee on this issue.
British Parliament
MP Sir Geoffrey Clifton-Brown, who also chairs Parliament’s public accounts committee, believes the government “could do more” to return unclaimed trust funds to their account holders.
HMRC said it was grateful for The Share Foundation’s ‘default withdrawal at age 21’ plan suggestion, but said the proposal was complex and could not be easily implemented.
“For HMRC to close these accounts, obtain the savings contained in these accounts and transfer them with or without the owner’s consent would require careful legal scrutiny,” a spokesperson said.
They added that the move would also require “operational systems and resources” within government departments and child trust fund providers to monitor transactions.
“The Government is committed to bringing all young adults together through their CTFs and recognizes the importance of ensuring young adults can benefit from these funds as they reach adulthood.
