Idea 3: Bring back Child Trust Funds but better

Child Trust Funds didn't survive long in the Coalition era. 

Introduced by Labour in 2005 they were designed to ensure all children had some savings set aside for when they turned 18. Money for a car, to travel, to tide them over at uni or to put towards a deposit for a house. The Tories promised to means test them to families with only £16,000 household income a year, under pressure from the Lib Dems (yes, the Lib Dems opposed CTFs) they were scrapped altogether in 2011.

The idea worked as so: Government would put in £250 for every child at birth. They would have then added £250 when the child reached 7 years old (plus an additional £250 means tested to low income families only) but of course the scheme was scrapped at age 6 itself. Rumours at one time suggested Labour intended on adding another £250 top up at age 11. 

I think we should bring back the Child Trust Fund but make it better than before.  

Government would contribute a certain amount, say £500 a year, to the children of the lowest income families with £250 being the average and less and less up until top earning families receive no contribution. The annual contribution would be dependent on families making a contribution themselves, again the amount required would be tapered so it's set at zero for those with household income below £18,000 and rising to £250 a year (£20.83 a month) for families earning £44,000 a year and the government subsidy tapers away thereafter by about £9.62 for every £1,000 earned up to £70,000 so a family on £55,000 a year would have to pay in £355.82 a year in order to trigger the release of the Government top-up contribution (of £144.18) to make the total £500 a year. A family earning £26,000 would have to pay £76.96 a year to unlock £423.04 from Government. Children in care would automatically get the full amount. 

It would cost just £192m to implement in its first year, rising in cost for 18 years until it settles on a cost of £3.5bn a year (in 2039 - presuming it takes a year to implement so starting 2021) which could be part funded by reversing Tory tax cuts for high earners I.e. Restoring the 50p tax rate or bringing inheritance tax back to the level it was set at before Osborne's most recent budget. 

These figures are very rough estimates but you get the point. The new and improved Child Trust Funds could allow every 18 year old to have a savings account of £9,000 (plus interest which hopefully will have kept up with inflation) to allow them the opportunities too often constrained to the children of the better-off.  

Interestingly the money sat in accounts would need to gain interest to at least keep pace with inflation so it could be invested in long-term assets in Government bonds - in other words, it could actually fund infrastructure investment!