Clause 3 - Requirements to be satisfied
Child Trust Funds Bill
3:30 pm
Ms Ruth Kelly (Financial Secretary, HM Treasury; Bolton West, Labour)
If the hon. Gentleman lets me develop my argument a little further, he will see that we are not prescribing that money should be invested in equities. We are saying that the stakeholder accounts should be risk-controlled and lifestyled, which means that the provider should take account of the market situation and the investor's needs and should manage the account. At the beginning, there will be significant growth potential, but as the child approaches the age of 18, the fund will move from a riskier to a less risky asset, such as a cash-based asset. As such, the fund will become much less volatile and the amount reached by the age of 18 much more predictable.