United Kingdom

Small victory in the struggle for locked Child Trust Fund savings

The parents of up to 200,000 disabled children who need to go to court to access locked Child Trust Fund savings may no longer have to pay fees in order to do so, in a partial victory for campaigners.

Families can ask for the Government to waive or refund Court of Protection fees of hundreds of pounds in instances where they have to prove their child does not have the capacity to manage their money, the Ministry of Justice announced today. 

The response from the Government represents a small win for This is Money, which has reported on the plight of disabled children barred from accessing their own money since late September.

However, campaigners said they were keeping 'the confetti on ice' and that more needs to be done. 

The Ministry of Justice said its intention was that no court fees would be paid in cases where families were only looking to access a Child Trust Fund held by a disabled child  

While these children do not have the capacity to manage their own savings, parents and guardians are also unable to manage it for them unless they apply to the Court of Protection to become a deputy. 

The Government has insisted this is to stop children being exploited, but in many cases, parents are already allowed to manage their child's benefits.

This application costs £365 and can require filling out up to 47 pages of forms, while solicitors' fees can take the cost to more than £2,500 and delays in the court system means it can take a year for a child's case to be resolved.

Parents can already ask the Government for help with court fees if they apply before their child's 18th birthday and their child has £3,000 or less in savings and earns less than £1,085, or after they turn 18 in 'exceptional circumstances'.

But the Ministry of Justice said today parents of children over 18 with Child Trust Funds worth more than £3,000 would not have to pay fees, provided the trust fund was their only asset.

It said applications for fees to be waived or reconsidered retrospectively would be considered on a case-by-case basis, and that its intention was that no one who needed to apply to the Court of Protection solely to access a Child Trust Fund would have to pay fees.

This is Money has asked for clarification on whether this waiving of fees applies only to the court's own fees or whether the Government would also cover solicitors' fees.

This is Money has reported on the problem facing disabled holders of Child Trust Funds and Junior Isas since late September 

While it represents good news for parents who may be put off the application process by the prospect of court fees wiping out their child's savings, it does not appear to solve the problem of parents having to wait a long period of time before their case is heard.

Philip Warford, managing director of Renaissance Legal, a law firm which for the last four years has been raising awareness of the problem facing disabled holders of Child Trust Funds and Junior Isas, the first of which began to mature this September, criticised the announcement.

He said: 'This is by no means any form of understanding by the Government of the problems they have created and what stress and extra work families will have.

'Families will still have to pay for a medical opinion; fill in all the same forms; wait at least six to eight months for a court order; and then be beholden to the Court of Protection in respect of an annual supervision fee.

This is by no means any form of understanding by the Government of the problems they have created and what stress and extra work families will have 

Philip Warford, Renaissance Legal 

'I think it's a screw top on something without any fizz.'

He previously told This is Money that the prospect of as many as 200,000 disabled children having to go through a court system already facing a backlog due to the coronavirus over the next decade could result in long waiting times for families.

The Ministry of Justice also announced it was setting up a working group involving officials from it and the Treasury to consider what more could be done to make the process easier for families.

Previous proposals put forward by representatives of CTF providers and campaigners include allowing parents of mentally disabled children with up to £5,000 in savings access to the money; and expanding rules which cover children with less than six months to live to also cover those without mental capacity.

Mr Warford added: 'The only positive is that there is a working group, or at least we're told there is, to try and see what else can be done. 

'Why on earth was the working group not put in place the day the problem began?'

The Government has previously sat on these proposals, and its inaction has meant individual CTF providers have had to decide for themselves on a case-by-case basis as to whether to let the parents or guardians of children access the money.

Last week we reported on the case of Catherine and John and their 17-year-old disabled son Oliver, after they won access to his previously frozen funds 

Last week we reported on one of the first examples of good news since we began reporting on the problem in late September, after a mother in Worcestershire unlocked her 17-year-old disabled son's Child Trust Fund on his behalf after going through the provider OneFamily.

The asset manager BMO became the second provider to offer to help out hard-up parents when it announced last weekend that it had 'adopted an exception process to help parents access' Child Trust Fund savings in cases where the child was mentally disabled and it was 'in their best interest'.

But without any wider changes to the law or to Government guidelines, this has left parents facing a lottery based on who their provider is.

Announcing the proposals this afternoon, justice minister Alex Chalk said: 'We want to reduce the obstacles families face in supporting young people who lack mental capacity.

'This fee remission will ensure that families who need to go to the Court of Protection to access these funds will not suffer financially as a result. 

'Our working group will look at improving this process even further, making it more streamlined and accessible.' 

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