Councils should make good on Child Trust Fund money

WHEN Gordon Brown, as Labour chancellor, introduced Child Trust Funds in 2002, it was a benefit intended to give all children a start on the savings ladder.

It was tailored to help lower income families who would receive an extra boost. The principle was sound. Indeed, of all the children who stood to benefit from this scheme, those in local authority care were surely the most deserving. It is all the more galling, therefore, to report that hundreds of Scotland's most vulnerable children have missed out on trust fund payments owed to them because councils in Scotland held on to the money.

Councils are legally obliged to pass on the money to children for every year they are in care since April 2008. But at least 20 of Scotland's 32 councils have failed to give children in care top-up payments owed to them for their child trust funds.

Our investigation reveals that only nine councils had made top-up payments by March this year — two years after the scheme was extended.

The problem looks to be particularly marked in Scotland. Comparison with elsewhere in the UK does not put Scotland's local authorities in a good light. In England, children in care have received direct payments from the government of 100 into their funds. And in Wales the Welsh Assembly doubled the money to 200. Indeed, some Welsh councils even added a further 100.

So what has gone wrong? Carelessness or inattention may have played a part. Some point the finger at the Scottish Government for delays in making payments to councils. Others blame bureaucratic oversight and confusion for this failure to pass on the money.

The end to ringfencing of grants in the concordat between the Scottish Government and local authoritiess may have allowed some councils to think — wrongly — that child trust fund payments were discretionary. But even if it did not occur to councils that they had a duty to look after the interests of vulnerable children who they took into their care, a routine check would surely have cleared up this misunderstanding.

Former Scottish justice minister Cathy Jamieson, now Labour MP for Kilmarnock and Loudon, has taken up the issue, pointing out that the money was given to the Scottish Government specifically for that purpose and that it took its eye off the ball. While there may be some merit in this charge, it does not absolve local authorities of their duty of care to children for whom they are responsible.

The coalition government announced in the Budget that it was stopping future payments under the fund. However, this does not affect the need for local authorities which have failed to act to do so now, and to make good those payments that are due. While a strong case can be made for payments to continue for children taken into care to help them accrue some capital available in later years, the argument cannot credibly be made until attention is focused, priorities adjusted and Scotland's local authorities have made good on the money owed.