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Pima warns on means test hitting child funds

The Pep & Isa Managers&#39 Association has warned the Government against being too heavy on means-testing child trust funds.

In an article for Money Marketing this week, Pima chairman Tony Vine-Lott says the trade body is uncomfortable with the idea of an “undefined degree of means-testing”.

In its consultation paper, Savings & Assets for All, the Treasury suggests that endowments made between birth and 18 could be subject to a family means test to assess

the parent&#39s financial situation at the time of each endowment.

Pima is calling for payments to be made to all children under 16 as soon as the scheme is started – not just to new-born children. The scheme is likely to make three or four payments throughout a child&#39s life – probably at birth, five, 11 and 16.

Vine-Lott says: “The potential issue we have is with the progressive end-owment element, which implies an undefined deg-ree of means-testing – a measure which we believe may be unnecessarily discriminatory, not to mention an unwieldy administrative burden.”

Investment Brief, p66

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