Cathy Jamieson: Government must not let down our vulnerable children

THE Finance Bill debate raged long into the night in the House of Commons this week.

MPs were sitting until 2am on Tuesday highlighting the impact of the VAT increase, the child benefit freeze and the abolition of the Child Trust Fund payments.

The planned abolition of Child Trust Funds is one of the budget proposals which will have far-reaching effects. One aspect which has, until now, managed to remain below the radar was the knock-on effect of ending Child Trust Funds for looked-after children.

The Child Trust Fund was set up in 2002 by the UK government and additional payments for looked-after children were introduced in 2008. Under the scheme, the UK government pays 100 per year to children looked after "away from home", including those in foster care, residential care and kinship care.

In England & Wales, HM Revenue & Customs pays directly into the child's fund. The Welsh Assembly Government took the decision to pay an additional 100 per year on top of the UK government's 100. In Scotland, funding was given by the UK government to the Scottish Government, who in turn passed it to local authorities.

This week, I found that only a minority of Scottish local authorities have been paying the 100 annual top-up payments, despite having received the money in their core grant from Scottish Government. That begs the question of what local authorities have done with the money intended to help those young people they have "corporate parenting" responsibility for.

Building up a personal fund that will become available when a young person moves into post-school education or employment training is designed to give that young person independence.

Having a personal Child Trust Fund offers useful educational opportunities in learning how to manage money, and there is the discipline of developing savings habits. Sadly, the Child Trust Fund for looked-after children is being abandoned just as we were beginning to unearth more efficient ways of operating it to the advantage of looked-after children.

This is an aspect of the care system which is still not well developed. Having access to individual asset accounts can make an important contribution to the wellbeing of children in care by providing a sense of security and encouraging planning for the future.

The Scottish Government and local authorities should also give more consideration to future financial planning for looked-after children.

This would be consistent with the recommendations of the 2009 National Residential Child Care review for developing corporate parent responsibilities, which have attracted widespread support.

At a UK level, the Conservative commitment was that they would end government payments to Child Trust Funds, except for children in "poorest third of families" and children with disabilities.

I have written to the Chancellor, George Osborne, to ask him to stand by his party's commitments and ensure this programme does not suffer from infanticide.

The consequence of ending the scheme will be to remove an important advantage only relatively recently introduced for looked-after children - one which was explicitly linked to efforts to improve outcomes.

That is bad enough, but it will be compounded if young people miss out on what they were entitled to because the Scottish Government and Local Authorities have also let them down.

• Cathy Jamieson is Labour MP for Kilmarnock and Loudoun.z