Young adults in Wales are missing out on £69 million in unclaimed, adult-owned HMRC-allocated Child Trust Funds, with almost half (46.1%) belonging to those from low-income backgrounds who need the money most.
As of the end of May, nearly 35,000 young people across the country are unaware of their accounts and don’t have access to what is rightfully theirs, according to figures from The Share Foundation.
The data comes as child poverty in Wales is set to reach its highest rate in 30 years, with the Joseph Rowntree Foundation warning that more than 34% of children could be living in low-income families by the end of the decade.
The Share Foundation, a registered charity that runs Junior ISA and Child Trust Fund schemes for young people in care throughout the UK on behalf of the Department for Education, is calling for the government to introduce automatic release of HMRC-allocated Child Trust Fund money when recipients turn 21.
Under the proposal, countersigned by former Minister Ruth Kelly and parliamentarians from both Houses, account providers would be required to close and pay out proceeds via Government National Insurance channels for all unclaimed HMRC-allocated matured Child Trust Funds.
“Child poverty is becoming one of the big issues of our time,” commented Gavin Oldham OBE, Chair of Trustees at The Share Foundation. “We need to break the cycle of deprivation which is why, over the past 12 years, we have been committed to establishing starter capital accounts for young people in care and helping young people from low-income backgrounds access Child Trust Funds they never even knew existed. These initiatives are delivering positive outcomes exactly when families need them most.”
