Dominic Perrottet’s children’s savings fund is to be increased by the grandparents

NSW grandparents will be able to contribute to a new children’s future fund promised by the coalition government, but Labor says many working families will not have the disposable income to put cash aside amid a cost of living crisis.

Prime Minister Dominic Perrottet pledged to set up a dedicated savings fund for every child in NSW to be used towards the cost of education or a home deposit as a cornerstone of his state election campaign on Sunday.

If the coalition wins the March 25 election, later this year the government would pay each child under the age of 10 $400 and increase their family’s annual contribution up to $400 until they turn 18.

Perrottet announced Monday that grandparents could also contribute money to the fund, although the annual family contribution would still be capped at $1,000 for each child.

Once kids turn 18, they can access the money and use it to contribute to a home deposit, HECS debt or tools for a trade, which Perrottet says would be life-changing.

“We know when it comes to pensions, we take care of older people and give them the support they need, but we’re not doing enough for our children,” he said.

“I know that every mother and father is ambitious for their children and that is what these reports achieve. This policy is all about family.”

But Labor leader Chris Minns said the $850 million it will cost the government over the next four years would be better spent on state education. He said many families don’t have the luxury of having cash reserves for decades to come.

“I think a lot of families with three kids would be like this morning, ‘I don’t have $3,000 left to put in a fund that can be accessed 20 years from now. I need help today,'” he said.