Recent estimates suggest that removing the two-child benefit cap could significantly alleviate poverty for up to 470,000 children in the UK. This policy change would allow low-income families to claim an additional £3,513 annually per extra child through universal credit. Initially implemented by the Conservative government in 2017, the cap has faced increasing scrutiny and calls for its removal from various quarters, including Labour MPs and Nigel Farage. Prime Minister Sir Keir Starmer recently indicated openness to reevaluating this policy as part of efforts to combat child poverty, despite previous firm stances supporting the limit.

Details of the Two-Child Benefit Cap and Its Impact

In a nation where approximately 1.2 million families have three or more children, around 370,000 of these households rely on universal credit (UC). Under current regulations, families receiving UC get £339 monthly for their first child born before 2017 and £292.81 for subsequent children born after 2017. However, most parents cannot claim benefits for any additional children beyond the second, except in special circumstances like twins or adoption. While general child benefit payments remain available for all children, lifting the cap would enable families on UC to receive an extra £3,513 yearly for every extra child, within an overall annual benefit cap of £22,020 nationwide or £25,323 in London.

According to research from the Child Poverty Action Group (CPAG), eliminating the two-child benefit cap could lift around 350,000 children out of poverty, with another 700,000 seeing improvements in their living conditions. The Resolution Foundation estimates that up to 470,000 children might escape poverty if the cap is lifted, or 280,000 if extended to three children. Since the Labour government assumed power last year, approximately 37,000 more children have fallen into poverty due to the cap's constraints. Despite significant costs associated with removing the cap—estimated between £2 billion and £3.5 billion annually—pressure continues to mount for reconsideration.

From a journalist's perspective, addressing child poverty is not merely about numbers but represents a moral obligation to ensure no child goes without essentials. By exploring alternatives such as extending the limit to three children at potentially lower costs, policymakers can strike a balance between fiscal responsibility and social justice. Sir Keir’s recent remarks signal hope for change, emphasizing that reducing child poverty should be a priority for any responsible government aiming for sustainable growth and equitable opportunities.