The government’s 2011 Budget confirmed that Junior ISAs would be introduced for all UK children under 18 who do not have a Child Trust Fund.
The ISAs are expected to be available from autumn 2011 with further detail on the Junior ISAs expected to be set out next week.
The government also said it was working with charities and other organisations to identify how children in care could be supported through Junior ISAs.
The Building Societies Association said it welcomed the Junior ISA and that it had been working with the Treasury on how the accounts would work. “Its introduction will go some way in filling the gap left by the abolition of the Child Trust Fund and mutuals are well placed to offer such accounts.”
The Child Trust Fund, introduced by the previous Labour government, was a savings scheme for children supported with a £250 savings voucher from the government. Children born between 2 September 2002 and 2 January 2011were eligible for Child Trust Funds.
The coalition government scrapped the Child Trust Fund after the general election in 2010.
John Reeve, chief executive of Family Investments, said the government still needed to offer further detail on how it planned to build Britain’s savings culture.
“To this end, we look forward to hearing the details next week in the Finance Bill on the forthcoming Junior ISA scheme. Only by offering every family access to a simple savings product that is straightforward enough to be managed without costly financial advice, can the government enable parents to save for their child from day one and look to address the bigger issue of providing young adults with a financial asset.”
The confirmation that Junior ISAs will be available from later this year follows the announcement of a replacement to the Child Trust Fund in October 2010.
© Fair Investment Company Ltd