Changes in UK Child Trust Fund rules to benefit 6m children More than 6m children stand to benefit from higher returns and lower charges on their savings after the Treasury lifted a ban on the transfer of Child Trust Funds into Junior Individual Savings Accounts. The Treasury said on Monday it would allow the estimated £5bn of savings currently held in Child Trust Fund (CTF) accounts to be transferred to a Junior Isa from April 2015. The move follows a public consultation on whether the ban, which has been in place for two years, should be lifted to allow children with CTFs to access the more competitive Junior Isa account market. "The government supports hard working families who want to save for their children," said George Osborne, chancellor of the exchequer. So I'm delighted that, as a result of these changes, over 6m children who currently have savings in a Child Trust Fund will be able to benefit from better returns and lower charges on those savings in the future. The Treasury said it had not been in a position to make a statement on the transfer ban in the Autumn Statement, as many had expected. However, it was "keen" to allow the transfers as soon as possible but did not expect this to happen before April 2015. Child Trust Funds are tax-advantaged long terms savings vehicles for children, which were introduced by the Labour government in 2005 but replaced by Junior Isas in 2011. The government had come under pressure over its decision not to allow children with CTFs to transfer their savings and investments into a Junior Isa, where the market is much more competitive. According to the Treasury, as of November 19 the best interest rate for a Child Trust Fund was 3 per cent while the best rate for a Junior ISA was 6 per cent. This is great news . . . 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," said Danny Cox, head of financial planning with Hargreaves Lansdown, the independent financial advisers. This change will pave the way for a significant improvement in choice and outcomes for over 6m children. However, many questioned why the government could not have acted sooner than April 2015, given the overwhelming support it had received for the transfer ban to be lifted. According to its consultation document published on Monday, 651 out of 661 responses were in favour of opening up Junior Isa to CTFs. We now need to see the government act as quickly as possible to legalise the process to prevent any further delays Gavin Oldham, chief executive, The Share Centre "The timetable for implementation of the change will be determined by the legislative process and it is difficult at present to estimate when this legislation will come into effect," said the Treasury. However, we hope that the first transfers will be possible by April 2015. The government also indicated that it would legislate to create powers to allow further intervention in the CTF market "in case this is required." "We now need to see the government act as quickly as possible to legalise the process to prevent any further delays," said Gavin Oldham, chief executive of The Share Centre Setting the date for April 2015 for the change would mean more than another year of higher charges and reduced product choice for over 6m children who will benefit from the transfer into a Junior ISA. From April 2014, children or their parents will be able to put aside up to £3,840 in a Junior Isa or Child Trust Fund.