Source · Select Committees · Public Accounts Committee
Recommendation 7
7
Accepted
HMRC told us that some young people may have consciously chosen not to claim their...
Conclusion
HMRC told us that some young people may have consciously chosen not to claim their savings yet, but The Share Foundation told us that accounts typically go unclaimed because the young person does not know that the money is there and the account provider does not have their current address.9 Providers are experiencing difficulties contacting many account holders.10 HMRC has increased its communications since 2018. In 2020, it ran a social media communications campaign that led to peaks in enquiries. It also issued press notices in September 2021, prompting a feature on the Martin Lewis Show, and in October 2022, prompting 82 press articles and an eight-fold increase in queries to its ‘Find My CTF’ service. However, HMRC acknowledges Child Trust Fund account holders are not its usual audience, and that there are lessons to be learnt on how government communicates with disengaged groups.11 Providers’ charges and stewardship of the accounts
Government Response Summary
The government agrees and states the recommendation is implemented, detailing HMRC's ongoing processes to find and contact young people with unclaimed CTFs. This includes engaging external partners, working with other government departments, and implementing a detailed communications plan targeting specific age groups to raise awareness.
Government Response
Accepted
HM Government
Accepted
1.1 The government agrees with the Committee’s recommendation. Recommendation implemented 1.2 Although primary responsibility sits with Child Trust Fund (CTF) providers, His Majesty’s Revenue & Customs (HMRC) has processes in place to find and contact young people who have not claimed their matured CTFs. In June 2023 HMRC published information on CTFs up to April 2022, including new tables showing the cumulative number of matured accounts. These indicate that as of 5 April 2022 around 428,000 matured CTF accounts had not been claimed, and approximately 338,000 had been claimed or were transferred to an ISA. 1.3 HMRC engages actively with external partners with the ability to interact with the CTF demographic group to raise awareness and provide further information. This includes family and friends, other government departments and partner organisations (such as the Money and Pensions Service), youth-focused charities, schools, banks, and other providers. As detailed below this is underpinned by a dedicated CTF working group, bi and multi-lateral engagement with key departments and a communications plan. 1.4 HMRC actively participates in meetings of the dedicated CTF working group. This comprises trade bodies and CTF providers and is scheduled to meet in September. The need to trace, and engage with, account holders is an established feature of discussions. 1.5 Quarterly meetings take place between HMRC, the Department for Education (DFE) and The Share Foundation – the charity appointed by DFE to manage CTFs and Junior ISAs of looked after children. A meeting took place in August and the next is provisionally scheduled for late Autumn 2023. Those meetings provide the opportunity to explore whether financial education can embrace awareness of CTF. HMRC also works closely with the Ministry of Justice (MoJ) as MoJ refines its approach to mental capacity and is working with MoJ and the Department for Work and Pensions on ways to raise awareness of CTFs with the parents of young adults without mental capacity. 1.6 HMRC has also developed a detailed communications plan which targets young people in two groups. Group 1 (18+) focuses on raising awareness of the matured CTFs waiting to be claimed and aims to reduce the number of unclaimed accounts. This includes ongoing work with the University and Colleges Admissions Service to encourage awareness among student peer groups. Group 2 (15-17) focuses on accounts which are due to mature in the next two years, to ensure that the number of unclaimed CTFs doesn't rise.