Instead, their families are forced to go to court to access the money, with the process being both lengthy and expensive.

The scale of the problem has been exposed by law firm Renaissance Legal which is running a #ChildTrustFundAccess campaign.

How Child Trust Funds work

CTFs were introduced by the government in 2005 with the aim of ensuring every child had savings at the age of 18. Each child received a voucher worth £250 (or £500 for those from lower income families) as an incentive to start saving. Families could then add up to £9,000 a year, with the child able to access the money when they turn 18.

The accounts were offered to most children born between 2002 and 2011. The savings product has since been superseded by Junior ISAs, although families can still pay into existing CTF accounts.

Mental capacity

But many young people who are disabled or with learning difficulties are deemed not to have the mental capacity to be able to access and manage this money at the age of 18.

If they don’t have the mental capacity, then their families or carers need to apply to the Court of Protection to act as the child’s deputy. This process can cost more than £365, a sum which may exceed the amount held in the CTF in the first place, and also be very time-consuming.

Renaissance Legal says there are more than 80,000 CTF accounts that cannot be accessed without going through the Court of Protection.

Time-consuming process

One parent, Michele Creed, has spent nearly £750 trying to access her daughter Alana’s savings account, a process which took about a year. Alana had £7,500 in her account but because she has severe learning disabilities, was not allowed to access the money.

When a parent or carer is granted access to their child’s savings, the Court of Protection makes them a “deputy” of the child’s financial affairs. This means Michele now has to account for every penny she spends of her daughter’s money.

Philip Warford, managing director of Renaissance Legal, says in some cases young people have £75,000 worth of savings stuck in CTFs.

He said: “Many of [these] families are fighting on all fronts, for the right education for their child, for the right amount in benefits, for better healthcare, and now they are fighting to get their own money back. The financial risk posed by these families is zero – it’s their money in the first place.”

Government plans dropped

In 2021, the government announced plans to make it easier for families of disabled children to withdraw money from CTFs and Junior ISAs, without the need to get permission from the Court of Protection (CoP).

But in February 2023, after a year-long consultation, it decided to keep the process as it is, in order to “protect against fraud and abuse”.

The government has not released recent figures about how much money is effectively “locked” in CTFs, but Ministry of Justice (MoJ) figures show only 15 accounts were accessed through the court process in 2021.

Renaissance Legal estimates that by 2029, the year in which all CTFs will have matured, there could be up to £210m locked away in accounts that families have been unable to access.