Cash top-ups and university bursary for children in care

The state will pay an extra £100 a year into the tax-free savings accounts of every child in care, education minister Alan Johnson has confirmed.

The plans, hinted at last week by children’s minister Beverley Hughes and economic secretary Ed Balls, will be included in the green paper on looked-after children expected early next month.

The annual top-up will be paid into Child Trust Funds of every child who has spent the previous 12 months in care. All children born on or since September 1 2002 have been eligible for a £250 voucher to open one of the long-term savings accounts, and a further payment of £250 will be paid into the accounts when children turn seven. The accounts cannot be touched until children turn 18.

Giving away more details of the forthcoming green paper, Johnson also announced a new £2,000 bursary to help children in care go to university. In 2004-5, only 6 per cent of care leavers went to university.

“Every good parent wants the best for their children and makes provision where possible to help them realise their potential,” he said. “As a proxy parent, the state must do the same for children in care the extra cash for Child Trust Funds and new money to create a £2,000 bursary to help children in care go to university and will give them vital financial support as they move into adulthood and ensure that their life chances aren’t undermined by lack of money.”

An extra £40m was also promised to support the introduction of new diplomas, which are being introduced from 2008 to provide 14- to 19-year-olds with an alternative to GCSEs and A-Levels. The diplomas, which will be available at three levels, will initially cover construction, the media, engineering, health and social care, and information technology. A further nine courses will be introduced by 2010.