Source · Select Committees · Public Accounts Committee
Recommendation 3
3
Accepted
Set out steps and statistics to ease Child Trust Fund access for young people lacking mental capacity
Recommendation
The Child Trust Fund scheme is not easily accessible for the families and carers of children and young people lacking mental capacity. The Ministry of Justice estimates that between 63,000 and 126,000 young people may not have the mental capacity to access and manage their matured Child Trust Fund when they reach adulthood. Instead, their family or carer must apply for legal authority to access and manage it on their behalf. However, the Court of Protection (covering England and Wales) approved only 15 such applications during 2021. Financial deputyship rules in Scotland and Northern Ireland are comparable to the rules in England and Wales, meaning similar issues are likely to have arisen. Fees are waived if families are only applying to access a Child Trust Fund but there are other barriers – we heard examples of a six-page GP letter being needed as part of the process, and the Downs Syndrome Association told us that low awareness about banking safeguards among parents it supports is a barrier to accessing their children’s Child Trust Funds. HMRC emphasised to us that the owners of matured Child Trust Funds are adults, and the law needs to protect their interests. Providers, the Ministry of Justice and HMRC are aware of the issue. HMRC said its guidance explains what people need to do. Some providers have, at their own risk, allowed families of young people without capacity to access funds in a Child Trust Fund up to £5,000. Recommendation 3a: In its Treasury Minute response, the government should set out what steps different bodies, including the Ministry of Justice and its equivalents in the home nations, are taking to help the families of young people who lack mental capacity to access their Child Trust Funds without excessive bureaucracy and cost. b) the government should include in the response statistics on how many people have used, successfully or otherwise, the current options available in each nation and set out the impact of the specific steps the govern
Government Response Summary
The government agreed and detailed existing legal avenues (Mental Capacity Act, Court of Protection) for accessing CTFs for those lacking mental capacity, clarifying the application process and correcting cited statistics. It also provided application data for Northern Ireland and explained data collection limitations for Scotland, directly addressing the request for statistics and steps taken.
Government Response
Accepted
HM Government
Accepted
The government agrees with the Committee’s recommendation. England and Wales The Mental Capacity Act provides for the jurisdiction of the Court of Protection (CoP) where a child under 16 is likely to continue to lack capacity when they reach 18. In these cases, the court can make decisions even though the child is under the age of 16 at the time of the application. This means that parents do not have to wait until their child reaches 18 before making an application and ensures that they can receive the necessary permissions well before the CTF matures. The figure of 15 applications to the COP in 2021 (quoted in the Committee’s report) relates to the number of cases where the Child Trust Fund was quoted as being the sole asset. This is not an accurate reflection of total court applications as many applications for the age group 16-21 year-olds made in the years July 2020 – March 2023 would have involved other assets, for example, damages awards, in addition to the CTF. A more complete reflection for the period July 2020 – March 2023 for the age group 16–21-year-olds is illustrated in the table below, where those aged 16 years are young people whose CTF had not yet matured, and 19-21 years is the age of the account holder who had not yet accessed their matured CTF. Number of Court of Protection applications for age group Year July 2020 - September 2021 - September 2022 - August 2021 August 2022 March 2023 (Age 16-19) (Age 16-20) (Aged 16-21) Number of 86 379 312 applications Where the application was made in the years 2020 - 2023 for a young person aged 16, the requisite court order would be received a full two years before the CTF matured, allowing parents to instruct on and access the CTF as soon as possible upon maturity. The figures in the above table are a subset of Family Court Statistics published by the MoJ. Scotland The Office of the Public Guardian (Scotland) advises that, to August 2023, 21 notes of interest relating to matured CTFs have been received and assistance and guidance has been provided where needed. There have been no applications to use the ATF scheme to access funds in a matured cash CTF. Any cases which have arisen have been either intervention orders or guardianships but data on the numbers involved is not collected centrally. Northern Ireland Since 1 September 2020, when the first CFT holders turned 18 years, the Office of Care and Protection (part of the High Court) in Northern Ireland has received 6 applications where the only asset required to be managed is a CTF. These have been dealt with by the making of a Short Procedure Order. Remission from court fees was available in 4 of these cases. There will be cases where an application has been made for a court order because the patient has assets additional to a CFT and/or is in receipt of Direct Payments but these would be harder to identify. of the Annual savings statistics: background quality report on Gov.UK.