§ Mr. GardinerTo ask the Chancellor of the Exchequer if he will offer incentives for contributions to child trust funds for those in receipt of child tax credit. [145698]
§ Ruth KellyThe child trust fund will benefit all children while making sure that most help goes to those who need it most.
The Government endowments are a powerful incentive for a child"s family to save. All eligible children will receive a Government endowment of £250. Children in households with a finalised claim to child tax credit (CTC) and income below the CTC threshold, currently £13,230, will receive an additional Government endowment of £250, making £500 in total. The Government will make further payments into accounts when children turn seven, and again, there will be an additional payment for the poorest children.
§ Mr. GardinerTo ask the Chancellor of the Exchequer if he will establish a website dedicated to providing financial education for(a) children and (b) parents on child trust funds. [145699]
§ Ruth KellyThe Inland Revenue is developing a dedicated website to provide a one-stop shop for information on the Child Trust Fund (CTF). It will include resources for a variety of audiences including parents, family members, children and teachers.
The Government will also work with the Financial Services Authority (FSA) to include the CTF in their consumer information activity. This will include incorporating the CTF into the FSA consumer website.
§ Mr. GardinerTo ask the Chancellor of the Exchequer which parent will have legal responsibility for their child"s trust fund should they divorce. [145701]
§ Ruth KellyThe situation for the CTF will be a matter of general law.
When a married couple separates or divorces, both parents retain parental responsibility. They are required to make an arrangement at the time of the divorce or separation specifying the arrangements for the child, which in practice, covers matters like living arrangements and contact arrangements, but would be encouraged to seek advice and agreement on other issues which could include the child's Child Trust Fund.
The general law reflects the principle that parents should not be regarded as losing their position and ability to take decisions about their children, simply because they are in dispute with one another about a particular matter.
§ Mr. GardinerTo ask the Chancellor of the Exchequer what scoping exercise his Department has conducted to assess the likely contributions those on low incomes will make to child trust funds. [145702]
§ Ruth KellyWe have asked Deloitte, an independent consultancy, to carry out detailed quantitative and qualitative research on the impact of different charge cap structures on the Child Trust Fund (CTF) market. This research includes analysis of likely contributions into CTF accounts.
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§ Mr. GardinerTo ask the Chancellor of the Exchequer what will happen to contributions and interest payments made to a Child Trust Fund while the Inland Revenue is considering whether or not a child is eligible for the topped-up endowment. [145703]
§ Ruth KellyThe Government will pay an initial endowment of £250 into every eligible child"s CTF account soon after it is opened. Children in families receiving child tax credit (CTC) and with a household income below the CTC threshold (currently £13,230) will receive an additional £250. This will be added to the CTF account once the CTC award for that year is confirmed.
Any contributions made into the CTF account or interest arising on the funds in that account in the period between payment of the initial Government endowment and the additional endowment will remain in the CTF account and no tax charge will arise on any income and gains.
§ Mr. GardinerTo ask the Chancellor of the Exchequer if he will allow investment companies to charge a basic administration fee for Child Trust Funds which would be topped-up by a performance-related administration fee. [145704]
§ Ruth KellyDraft regulations setting out the charges for Child Trust Fund accounts will be published during the passage of the Bill.
§ Mr. GardinerTo ask the Chancellor of the Exchequer whether parents under 18 will be able to make decisions on trust funds for their children. [145705]
§ Ruth KellyIn England Wales and Northern Ireland where a parent under the age of 18 has a child who is eligible for a CTF account it will not be possible for that parent to manage their child's CTF account. This is because although parents have parental responsibility for their children under the Children Act 1989 they do not have the legal capacity to enter into binding contracts to purchase equities.
As a result they are not able to make decisions about CTF accounts. In these circumstances the Inland Revenue will open a stakeholder account CTF account on behalf of the child. Once the parent reaches the age of 18, they will be able to assume responsibility for managing their child's CTF account.
The situation is different in Scotland where 16 year olds are entitled to make their own decisions about their property, including CTF accounts. This means that a parent aged between 16 and 18 in Scotland will be able to manage their child's CTF account.
Council tax as a percentage of disposable income for pensioner1 and non-pensioner households, 1997–98—Great Britain2 Quintile groups of all households ranked by equivalised disposable income Households Bottom 2nd 3rd 4th Top All households Quintile point3 (equivalised disposable income,£ per year) Pensioner 7,701 9,503 11,707 15,393 Non-pensioner 9,177 13,623 18,449 25,508 All households 8,504 11,922 16,342 23,457 Gross council tax as a percentage unequivalised disposable of income Pensioner 9.4 7.0 5.8 4.5 3.4 5.1 Non-pensioner 6.0 3.7 2.9 2.3 1.7 2.6 All households 6.8 4.7 3.2 2.6 1.8 2.9