Savings Accounts and Health in Pregnancy Grant Bill

Wednesday 15th September 2010 Written Statements

[The Financial Secretary to the Treasury (Mr Mark Hoban)]

The Savings Accounts and Health in Pregnancy Grant Bill has today been introduced into the House of Commons.

This Bill would end eligibility for child trust funds and abolish the health in pregnancy grant from January 2011, and repeal the Saving Gateway Accounts Act 2009.

The Government announced on 24 May that they would reduce and then stop Government payments to child trust funds. The Child Trust Funds (Amendment No. 3) Regulations, made on 22 July, have already reduced Government payments. The Government also announced at the Budget on 22 June that the health in pregnancy grant would be abolished, and that the introduction of the saving gateway would be cancelled.

All of these measures will contribute to the reduction of the UK’s budget deficit. The changes being made to child trust funds, including through this Bill; the abolition of the health in pregnancy grant; and the cancellation of the saving gateway’s introduction are expected to save £370 million in 2010-11, and around £800 million in future years.

The Government have also published today an initial assessment of the equality impacts of the measures included in the Bill, and an initial estimate of the impacts of the changes being made to child trust funds upon account providers. Copies of these documents have been deposited in the Libraries of both Houses and are available from the Vote Office.