Today, Rachel Reeves announced that the two child benefit will be scrapped next April in a bid to lift 450,000 children out of poverty.
This marks a significant change in social welfare policy, which the Office for Budget Responsibility (OBR) estimates will cost the government £2.3bn.
The move also signals a shift towards a more compassionate approach to welfare provision – as Reeves herself said that children should not be penalised by policy.
The two-child limit is a UK policy that restricts means-tested benefits to a maximum of two children per family.
Introduced in April 2017 under the Conservative Government, families with a third child or subsequent children born after this date do not receive additional payments to cover living costs.
The policy left many unable to afford basic necessities, with families missing out on over £3,000 per child per year.
Many working families who were ineligible for additional benefits struggled to balance employment and rising childcare costs under the cap.
Today’s announcement brings hope for those in need of increased support in the UK, where recent data shows that around 30% of children in the UK live in relative poverty. The situation is even more acute in Nottingham, where the child poverty rate approaches nearly 40%.
Scrapping the two-child benefit cap will provide increased financial support for larger families, helping to alleviate child poverty and reduce economic hardship.
In addition to immediate benefits, the long-term effects are likely to be significant, as families will be better able to provide children with essentials such as higher-quality food, improved education opportunities, and access to healthcare.
However, some have argued that relaxing the benefit restrictions may encourage higher birth rates, increasing government spending in the long-term.
Questions remain about how this change fits within the wider framework of social security reform and whether further adjustments to welfare policies will follow.
Labour welcomed the announcement, while some Conservative MPs expressed concerns about the potential rise in welfare spending.
As this policy takes effect, it will be important to monitor its impact on families and how best to support vulnerable populations in the years ahead.
