As the September launch of the Financial Education Savings Programme (FESP) draws near, new details have emerged regarding its structure and the significant investment the government is making in the first group of approximately 11,000 children who will benefit.
Every child between ages 5 and 18 who is a citizen of St. Kitts and Nevis will receive a start up deposit of EC$1000.00. Of this amount, $500.00 will be invested on their behalf in government owned organisations or companies in which the government holds majority shares. This amounts to an initial investment on the government’s part of approximately EC$11 million.
Each of the savings accounts, and any dividends accrued through investments, will be held in trust by the St. Kitts Nevis Anguilla National Bank.
Neither the account holder, nor their guardians, will be able to access the funds until they have at least attained the age of 18. Both the children and their parents are encouraged, however, to make regular deposits to these accounts in order to foster good financial habits.
The plan is for the government to divest some of its shares so that the children who are part of the programme can become beneficiaries. In this way, FESP will fulfil its mandate of establishing a sound financial footing for the country’s children.
According to Cabinet Secretary, Dr. Marcus Natta, who heads FESP, while the launch is on target for later this year, the initiative will be rolled out in phases.
“This is a three pronged type of programme. So, you have the financial, education, literacy, skills development portion, you have the savings accounts portion, and then you have the investment portion in terms of the shares,” Dr. Natta explained.
What we feel is a low-hanging fruit, so to speak, is opening a savings account. Each account accesses a savings account… [for] the children. This account will be held in trust for the programme’s future, [those] who cannot open a savings account until you’re 18, without a parent or a guardian. So, everything will be held in trust, which you cannot touch until you exit the programme.
“The education curriculum is essentially done, so we hope to roll that out, if not on day one in September of the new academic year, probably shortly thereafter, but hopefully within the new academic year, and the investment portion part is the more complex part that we are working through and we are nearing completing how we would actually do that,” he continued.
The initiative is the brainchild of Prime Minister Dr. Terrance Drew who holds ministerial responsibility for Finance. Dr. Natta disclosed that Prime Minister Drew has identified The Cable and the St. Kitts Nevis Anguilla National Bank. Others, including the St. Kitts Electricity Company and the Water Department have also been touted as possible entities in which shares may be made available as time progresses. It has been hinted that companies outside the government sphere may also be considered in the future in order to diversify the investment pool.
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