The Share Centre launches petition to increase CTF payouts

by Simon Keane

Private investors are being urged to back a petition to the government calling for increased payouts under the Child Trust Fund (CTF) scheme in line with inflation.

Retail stockbroker The Share Centre has launched a campaign after raising concerns that future generations will lose out as inflation erodes the value of CTFs. Under the CTF scheme, children receive two payouts of £250, one at birth and a further payment at age seven.

Guy Knight, sales and marketing director at the The Share Centre, says: ‘When we feel that private investors are not being treated fairly we will stand up for them and there is no reason why children shouldn’t be treated as private investors.’

The Share Centre has worked out that, over the course of the scheme, children born today will receive £145 less than their predecessors and that is based on a historic Consumer Price Index (CPI) rate 2.4%, versus today’s 4.4%. It says babies born today should receive an initial payment of £288.

Like an Individual Savings Account (ISA), shares held via a CTF are free from the 18% capital gains tax rate and parents have the option to make additional payments up to £1,200 a year. The balance can be drawn down when the child reaches 18 or rolled into an ISA.

Since setting up the petition Knight says around 400 people have already signed. The Share Centre has a track record of campaigning for the private investor having recently pressurised the government to give more rights to investors who hold shares via nominee accounts. It is also calling for stamp duty on share dealing to be scrapped.

To sign the petition go to www.share.com/fairdeal