Coalition hits social mobility

Many of the planned cuts in today's package from George Osborne are entirely predictable, and probably understandable given the decision to cut public spending further this year. But the decision completely to scrap child trust funds is a serious and retrograde mistake.

Encouraging poorer families to save for their children's futures ought to be a key objective of any administration; supporting social mobility by giving people a chance to acquire assets can be as important as a decent education.

People who have assets - as many in the Cabinet can surely attest - have a greater stake in society and a better chance of getting on. That's what the Child Trust Fund, which David Blunkett first proposed when he was Education and Employment Secretary, was about. As he says today:

In the most deprived areas, the default accounts set up for our children's future was the one hope that those doomed to intergenerational disadvantage might emerge at 18 with at least some chance of a deposit on a home, an opportunity to take advantage of higher education or the beginning of self-employment.

And as Hopi Sen rightly observes:

I should simply say that this is an example of the Lib Dems making a Tory policy worse. The Tories proposed to retain Child Trust Funds for the bottom third of families by income (Which would roughly mean for any family with a pre tax Credits income of c£15,000) That’s bad, because the 15k/16k mark is well below the point at which financial capital is needed for children, but at least it’s something. Progressive Alliance types? This one is on you.