Millions of Pounds Trapped in 80,000 'Child Trust Fund' Accounts of disabled teens

A report suggests that tens of millions of pounds belonging to approximately 80,000 young people without the capacity to make financial decisions could be placed in trust funds.

When the accounts mature, these families must go to court to access their savings, a procedure that can take months and cost hundreds of pounds. In 2021, only 15 accounts were accessed in this manner. The government asserts that it is unable to release more recent statistics. It claims to be attempting to expedite cases.

One mother told sources that she wished she had never endured the "hugely stressful" process and advised others against doing so. She said that she can’t believe she’s had to go through all this trouble to access the birthday money, Christmas money, and other savings they have set aside for her.

Alana, like millions of other children born between 2002 and 2011, received between £250 and £500 through the Child Trust Fund programme of the then-Labour government. Then, families could contribute their own contributions to the pot to help it grow. Alana currently has £7,500 in her bank account.

The 19-year-old has significant cognitive disabilities and is incapable of making financial decisions. Therefore, instead of being able to withdraw the funds at the age of 18 like the majority of her peers, her family had to spend nearly £750 proceeding through the Court of Protection.

To ensure that both she and her husband could access their daughter's savings, Michele says she had to go through the court process twice, at a cost of £371 each time, due to the complication. It took an entire year.

Michele mentioned that while Alana’s older sister was able to get her money without any difficulty, there was this enormous obstacle that they had to overcome for Alana. Michele is one of the few parents who have been able to access her daughter's funds through the Court of Protection. In 2021, according to Ministry of Justice (MoJ) statistics, only 15 accounts were accessed through the court system.

Michele wishes she "had never begun" the "long, bureaucratic, and costly" process to get Alana's money, and she advises other families who are contemplating litigation to reconsider.

When a parent or guardian is granted access to their child's savings, the Court of Protection appoints them as the child's delegate for financial matters. This means Michele must account for every cent she spends from her daughter's funds for the rest of her life.

She describes the ongoing scrutiny as a "slur" on her character and points to the stack of receipts and spreadsheets that demonstrate how she is spending Alana's benefits and savings as evidence. Alana enjoys frequenting Caffe Nero, so Michele occasionally spends £100 per month on coffee with her. It's her preferred activity, and now I feel obligated to justify it.

There are more than 80,000 accounts that cannot be accessed without going through the Court of Protection, according to a report compiled by Renaissance Legal, a firm that assists families during the procedure. By 2029, when all of these accounts will have matured, families may be unable to access up to £210 million in Child Trust Funds.