CTF scheme 'too complex' expert argues
The Child Trust Fund (CTF) scheme has been criticised by one expert as being too complex.
Under the scheme, children born on or after September 1st 2002 and for whom child benefit is being received get a voucher for £250 from the government that is placed in a long-term savings account into which parents and other relatives can contribute.
The vouchers are meant to be invested by their parents in an approved account, however, many people are choosing to allow the government to invest the money for them when the vouchers expire.
In addition, lower socio-economic households are less likely to set up a CTF and are, therefore, less likely to make further contributions.
According to Kate Baker, head of savings and investments for Family Investments, many parents are failing to invest due to the complicated nature of the scheme.
She said: "We believe that take-up should be at a much higher level and this can only be achieved through a simplification of the entire scheme."
