Nov 28 2006
A majority of MPs believe that the government should do more to guarantee that children have adequate savings by the time they become adults, according to recent research.
The study by Nationwide building society found that 58 per cent of MPs believed that children too old for a child trust fund (CTF) and too young to set up an individual savings account should be permitted to save £1,200 tax-free each year.
An additional 52 per cent believe that the government should top up CTFs when a child is eleven to help foster a savings culture among young people.
Stuart Bernau, executive director at Nationwide, said: "The government has made a good start with the introduction of the CTF, highlighting that children's savings is a priority."
He added that despite this, there were injustices in the taxation of children's savings and urged equitable tax treatment for all children, irrespective of their qualification for a CTF.
In September, Nationwide called on the government to treat children equally with regards to taxation of saving, estimating that those too old to be part of the CTF scheme were liable for £60 million a year in tax more than those that are the right age.
