Child Trust Funds (Amendment No. 3) Regulations 2010

I shall speak to my amendment in a moment, possibly with some significant conclusion, but, first, I thank all noble Lords who have contributed to a very constructive debate. One obvious divide in the debate is that my noble friends Lord Morgan, Lord Liddle and Lord McKenzie emphasised the distribution of wealth, which is what the scheme is about. The scheme is not about child benefits and support for poor families in the short term; it is about producing a modicum of wealth for young people at the age of 18, when it is recognised that they need it. What is important about that is not that there will not be disparities between the middle class and the poor, and between the very wealthy and the middle class—of course there will. Of course those with greater resources will contribute more, but the significance of this scheme is that it brought, and brings, the crucial issue of a savings culture to the less well-off. It provides for young people who come from poor homes at least a toehold on resources and brings them within the framework of the nation as far as wealth is concerned. The Minister, with his contributions on what the Government will do to ameliorate the impact on poor people through tax changes and changes to benefit, convinces no one. First, we all know in this House that if we think that there is to be a major redistribution of wealth from the better-off to the less well-off in our society under the coalition's politics, we will be grievously mistaken. We are not going to be conned with those generalisations, nor will we accept that this is about a direction of travel. It is not. This is about a full stop. The noble Lord, Lord Hodgson, made a constructive point and in a moment I will give him due credit for that. I do not accept that the Government’s proposals are anything other than an interim for a matter of months; that is, to cut and then to stop something most constructive. The noble Lord, Lord Blackwell, indicated that the funds are a gimmick, but they are not at all. They were to engage and to be an incentive to those whose propensity to save is very low. The noble Lord, Lord Newby, thought that the substitute could be ISAs. My heavens, if ISAs had been the substitute, we would not have the distortion that we have at present in those who benefit from incentives to save. He knows very well that, whereas this scheme engages 30 per cent of the population, ISAs engage about 13 per cent from those who are better off and can afford to save. I am grateful to the noble Lord, Lord Hodgson, and the noble Lord, Lord Naseby, who speaks with great insight. They emphasised the importance of the Government thinking again about the infrastructure of this scheme. On our Benches we would probably use the word ““principles””. I know that such a word is almost alien to those who form a coalition of diverse views and call themselves a Government but, if the Minister is to discuss some issues of principle which can be saved and safeguarded with those who have been concerned about this scheme and have contributed so much, in order that we could build on the successes achieved so far, out of this debate and the ashes of the Government’s proposal would come one small glimmer of hope for the Opposition. There is not sufficient of a glimmer of hope to dissuade me from believing that I should test the opinion of the House. Division on Lord Davies of Oldham’s amendment. Contents 154; Not-Contents 189. [The name of a noble Lord who voted in both Lobbies has been removed from the voting lists.] Amendment disagreed. Motion agreed.