MPs back Nationwide's campaign to encourage children's savings

Research commissioned by Nationwide Building Society reveals that MPs feel that more needs to be done to ensure that children have sufficient savings behind them when they enter adulthood.

It also reveals that most MPs want equal tax breaks for those children who don't qualify for a Child Trust Fund (CTF), an issue for which Nationwide has actively campaigned.

Treasury Minister Ed Balls has stated recently that the Government's task "is to entrench a culture of savings for people of all ages". This new research highlights that the current Government-assisted offering provided by the Child Trust Fund is a firm foundation which could and should be extended to benefit all children.

The research revealed the following:

Almost six in ten MPs (58%) agree that those too old for a Child Trust Fund and too young for an ISA should also be eligible for tax-free savings of up to £1,200 annually.

Just over half of all MPs (52%), and 69% of Labour MPs, think that an additional top up to the Child Trust Fund at age 11 would improve the savings culture among today's young people.

However, less than half of MPs (45%) believe the take-up of the Child Trust Fund has been a success in their constituencies.

92% of Labour MPs feel that the Government should take measures to increase early take-up of CTF vouchers to ensure that children do not miss out on interest on, or growth of, the Child Trust Fund.

Waiting 12 months before automatically investing the money for parents who take no action means these parents' children are loosing out on a whole year's interest or growth in their fund.

Stuart Bernau, Nationwide executive director, said: "The Government has made a good start with the introduction of the Child Trust Fund, highlighting that children's savings is a priority. But there remains some real unfairness in the way some children are taxed. If we want to encourage further children's savings we need fair tax treatment for all, whether or not they qualify for the Child Trust fund."