1.6 Million Children Affected by Two-Child Benefit Cap as Pressure Mounts on Labour Government to Lift It
The controversial two-child benefit cap introduced by the Conservative government in 2017 has now affected a total of 1.6 million children, according to the latest government statistics. The cap, which restricts families from claiming child tax credit or Universal Credit for more than two children, has faced criticism for its negative impact on low-income households.
Economist Lalitha Try from the Resolution Foundation has stated that there is little evidence to suggest that the policy has achieved its intended goal of boosting employment. However, there is clear evidence of financial loss for families. “Unless the policy is abolished, the majority of children in large families will fall below the poverty line by the end of the parliament,” Try added. She also emphasized the need for any new child poverty strategy to allocate funds for the removal of the cap.
The number of households affected by the two-child benefit cap has increased significantly from 71,000 in April 2017 to 450,000 in April 2021. Of the 1.6 million children affected, 1.3 million are from households claiming Universal Credit, while 270,000 are from households claiming child tax credit.
Calls to scrap the cap have been growing, with Labour MP Kim Johnson urging party leader Sir Keir Starmer to include it in next week’s King’s Speech. Johnson represents the constituency of Liverpool Riverside, which has been identified as the most deprived in the country, with nearly half of its children living in poverty. “The families I represent just cannot wait any longer,” Johnson said. She also highlighted the broad support for scrapping the cap from across the political spectrum.
In addition to Labour, the Liberal Democrats, SNP, and Plaid Cymru have also called for the cap to be abolished. Work and Pensions Secretary Liz Kendall has acknowledged the issue and stated that the government will work towards giving every child the best start in life by implementing their manifesto commitment to reduce child poverty. “I will hold critical meetings with charities and experts next week to get this urgent work underway,” Kendall added.
Under the current policy, households receive £25.60 per week for the eldest or only child and £16.95 for the second child, with no support provided for any additional children. While child tax credit is available to all, higher-earning parents may have to pay a charge, making it unattractive for many to claim. It is clear that the two-child benefit cap has significant implications for families living in poverty and the government must take decisive action to address this issue.
