Clause 6 - Opening by Inland Revenue
Child Trust Funds Bill
1:00 am
Mr David Laws (Yeovil, Liberal Democrat)
I am not going to be as generous as the hon. Gentleman, although we have signed up to his amendment. I am concerned that the clause involves
the Inland Revenue and the Treasury essentially giving advice and making decisions, but then accepting no responsibility for the providers selected or for the asset classes in which the child trust funds are invested on behalf of those individuals for whom the Inland Revenue assumes responsibility.
I understand why the Minister is concerned that we ensure that those people who do not have family to manage their child trust fund accounts have their interests taken into account, and have the returns from their account maximised. That is why the Minister made the decision about the equity-skewed account. However, if the Minister is going to act in loco parentis to that extent, it is not good enough for the Inland Revenue to simply wash their hands of the credit and other risks that may be assumed to be dependent on the provider involved in an individual's account and the performance of the investment over a long period. I am not going to go back over the examples that I cited earlier, but they are relevant to this amendment.
If the Inland Revenue tries to exercise responsibility for, and take an interest in, particular vulnerable group of people, as implied by its decision to select an equity investment, that cannot be the limit of its involvement in respect of credit risk and market risk. I can only hope that the Minister's comments about the potential involvement of the Solicitor-General indicate some flexibility on this point.