'Child Trust Funds'

I think we all believe that every child should have the best possible start in life. That is why the Government has created the Sure Start centres, to give the children in our communities and their parents the very best start in life, right from birth.

But what about when these children reach eighteen and become young adults, taking their first steps into the adult world?

At eighteen our young people face difficult, often daunting decisions about what choices to make, and what direction they take. Should they stay in education, go to university or college and get a degree or HND? Or go into employment? Some may want to leave home, buy a car, start their own family.

What support can we offer them as they face tough decisions about their future?

Well, the Government is helping these young people to make their life choices by introducing Child Trust Funds for every baby born on or after September 1st 2002.

So what is a Child Trust Fund? Well, it's a new Government savings initiative, aimed at helping young people to get a financial head start when they reach eighteen. The Government will make a £250 payment to every baby to kick-start the trust funds, and then family - parents, grandparents, aunties and uncles - and friends can make additional payments of up to a total of £1200 per year.

Even better, babies born into households whose incomes are below £13,230 will get an extra £250.

When the child reaches seven, the Government will make another additional payment, as a sort of birthday present from the Inland Revenue.

So how will this help our young people make their life choices when they reach eighteen?

Well, the Child Trust Fund means that all eighteen year olds will start adult life with the backing of a financial asset to invest in their future, to give them added security and better opportunities.

The money saved in the Child Trust Fund account could help to pay for a university or college course to help continue then young person's education.

Or it could help them to buy a car and driving lessons to get to their first job, allowing them to access to employment in locations that may not be easy to reach by public transport.

Or it could help a young person set up their own home, helping them to increase their independence.

Some of our eighteen year olds choose to leave home and start their own families - imagine having a financial resource ready to pay for the costs of a white wedding, or to buy the very best baby equipment to care for their own children?

Of course, when the child reaches eighteen, spending the money saved up in the Child Trust Fund may be very appealing, but what else could be done with it? Well, the money could always be re-invested in another savings account, so that I continues to grow to be an even bigger resource in the future.

In order to help our young people get the best possible start in life, we need to invest in their futures right from the moment they are born.

Too often the Government and politicians are accused of not being able to think beyond the next election - the Child Trust Funds are a measure that prove that the Government is thinking about the future, and most importantly, thinking eighteen years into the future to help our young people make the best choice possible when they face some of the most important decisions of their lives.