The Government is responding to fears that its much-vaunted Child Trust Funds (CTFs) are being ignored by the public with the launch of a new advertising campaign to promote the “baby bonds”, in what is being seen as an admission of failure.
The new campaign will target parents who are still unaware of the scheme, and comes after disappointing take-up of the government scheme, despite &£5m being spent on the launch campaign. Up to 1 million of the 1,700,000 vouchers, worth between &£250 and &£500 to children born after September 2002 and issued in February and March, have yet to be invested.
Government paymaster general Dawn Primarolo is planning to launch an advertising campaign in July to promote the CTFs. Bosses at HM Revenues & Customs (HMRC), the new government department that encompasses the Inland Revenue, signed off a new campaign to advertise the vouchers this week. M&C Saatchi, the agency that created the Government’s launch activity at the beginning of 2005, has been appointed to the task.
Previously, HMRC had said it would focus only on localised activities when advertising CTFs, and would target new parents. But an HMRC spokesperson attributes the U-turn to the pulling of earlier ads following the announcement of the general election, which is in line with parliamentary rules.
Trust-fund providers are also said to be disappointed with the response to the Government’s “nest egg” accounts. When Nationwide publishes its annual results this week it will announce that it has opened 100,000 CTFs. Halifax has opened just 50,000 accounts.
Parents are given one year to open a CTF account, and although after 12 months they are automatically opened, parent apathy means children are collectively losing about &£1m in interest every month.
Family Investments head of marketing Miles Bingham says that it has opened 115,000 accounts, yet despite being a market leader it finds the initial uptake much lower than expected.
He adds: “It is in everyone’s interests to get these accounts activated. The Inland Revenue needs to readvertise or rewrite to everyone who hasn’t taken out a voucher.”
Feedback research commissioned by Family Investments, which rebranded from Family Assurance last year, shows that parents view the vouchers as low priority and find the scheme “confusing”.