The Chancellor, George Osborne, said the decision “supports hard-working families who want to save for their children”, reports the Daily Mail.

JISAs were introduced in 2011 to replace CTFs, which were no longer receiving government contributions.

Child trust funds were introduced by Labour and gave parents of every child born in Britain from 2002 seed money of £250.

However, transfers from CTFs to JISAs have previously not been permitted. It was hoped a rule change would be introduced in the Autumn Statement earlier this month, but Osborne did not mention the savings plans. 

Danny Cox of Hargreaves Lansdown said: “This is great news. The days of the Child Trust Fund have been numbered since the launch of the Junior ISA. Child trust funds have been in terminal decline since 2011, seeing millions trapped in expensive products or suffering lower interest rates than their Junior ISA counterparts.

“This change will pave the way for a significant improvement in choice and outcomes for over 6 million children. Transfers should happen from April 2015 and in the meantime, parents and grandparents who are saving into Child Trust Funds for their children or grand-children should continue to do so”