Child Trust Fund investments

Like all investments, my colleague John Mann, the MP for Bassetlaw, has been highlighting the drop in value of Child Trust Funds since the global banking crisis began.

I've been campaigning since 2007 to encourage local families to claim their children's trust funds - around three quarters do. On top of the lump sum the Government invests for all babies born since 2002, relatives and friends can add up to £1,200 a year to the accounts.

For me, Child Trust Funds are among the government's most significant achievements and, used wisely, could provide a major help to anyone going to university, starting in work, buying a first car or putting down a deposit on a flat - even reinvesting for a rainy day.

But as investment portfolios have lost value so to have the CTF investments - by as much as 32%. John Mann is calling for all investments to the funds made before the child is ten (which as the scheme is only seven years' old means all investments to date) to be guaranteed. The problem is not so much about whether the funds - which can't be touched until the age of 18 - will recover their value, but more that the losses and instability are giving pause for thought to those who might otherwise have invested.

So much of the current global financial crisis is down to confidence - or the lack thereof. Banks won't lend to each other because of this lack of confidence, and that's driven those with less cashflow to the wall; in turn starving businesses of much needed financing and sparking a chain reaction. John Mann's principal concern is restoring confidence to the Child Trust Fund idea - because this is one of the most significant ways a family can invest in their future.