Scrap two-child benefit cap if you're serious about child poverty, Rachel Reeves told

The two-child benefit cap is still in place after Rachel Reeves’ first spending review, a move that charities say fails to address the root causes of child poverty.

Unveiled on Wednesday (11 June), the spending review pledged billions for schools and childcare and was billed as a blueprint for national renewal. But campaigners argue the cap, which limits benefits to a family’s first two children, undermines the government’s promise of a fairer start for all.

Among other commitments, the chancellor announced £2.4 billion to build new schools, £2.3bn a year to maintain existing ones, and £370 million for school-based nurseries. She also expanded free school meals to all families on universal credit and confirmed the rollout of breakfast clubs, which are already being piloted in 750 schools across England.

But experts say Reeves’ promises fall flat while the cap remains, warning it will continue to deny thousands of children an equal chance to succeed.

“The chancellor described austerity as destructive, but the government is still rolling it out in the two-child limit, which pulls 109 children into poverty every day,” said Alison Garnham, chief executive of the Child Poverty Action Group.

“Struggling families won’t feel any renewal until the two-child limit – the biggest driver of rising child poverty – is scrapped, and that must happen in the autumn budget.”

Dan Paskins, executive director of policy, advocacy and campaigns at Save the Children UK, added: “Alongside expanding free school meals, the chancellor has demonstrated she is committed to reducing child poverty. 

“We must see this mission to support children in low-income families continue throughout parliament. The next step is to scrap the two-child limit and benefits cap.”

Read more:

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• ‘I was dying in silence’: How childcare becomes a daily battle for survival for migrant families
• Labour reveals £1bn plan to replace household support fund for poorest families

The two-child benefit cap, introduced by the Conservative government in 2017, means families are only eligible for benefits for their first two children; subsequent children are not entitled to any further benefits. This cap reportedly reduces a family’s income by £3,455 per year.

According to the Child Poverty Action Group, scrapping the policy would lift 350,000 children out of poverty and reduce the level of poverty experienced by a further 700,000 children.

Joseph Howes, chair of the End Child Poverty Coalition and CEO of Buttle UK, welcomed Reeves’ commitment to policies investing in children, including “expanded eligibility criteria for free school meals and the commitment to reduce the cost of school uniforms”. However, he stated that her promises still “fall far short of meeting our eight tests for the child poverty strategy, and as a result will not make significant progress on tackling child poverty.”

“The government must urgently make a clear commitment that it will scrap both the two-child limit and benefit cap as part of the forthcoming child poverty strategy to give families real hope that they are committed to tackling the root causes of child poverty in the UK,” Howes added.

Nick Harrison, CEO of the Sutton Trust, explained that Reeves’ commitments on schools, skills and training, youth centres and other facilities for young people are “encouraging to see”; however, more needed to be done to tackle poverty for many students in the UK.

“Measures to widen free school meal eligibility, feeding more children from homes that are eligible for universal credit, are the right thing to do. It’s also good to see some funding for school-based nurseries,” Harrison explained.

“However, the lack of consideration for improving student maintenance continues to concern us. Students from the poorest backgrounds continue to struggle with day-to-day costs, with significant numbers skipping meals and missing classes and deadlines due to having to work to make ends meet.”

Harrison explained that if the government is “serious about genuinely delivering greater opportunities for young people”, it must urgently deliver measures in order to “break down barriers to opportunities”.

“It’s not immediately apparent how today’s announcements will be transformational for disadvantaged young people. But given the current fiscal environment, it could have been a lot worse,” he explained.

Dr Philip Goodwin, CEO of UNICEF UK, explained that also absent from the spending review were measures to protect young children and babies.

“It is deeply worrying that babies and young children are almost invisible in today’s comprehensive spending review, with no reference to the long-promised expansion of health visitors, early childhood services, or significant measures to address the rising tide of pre-school poverty,” Dr Goodwin said.

“We urge the government to ensure that under-fives are prioritised in the additional NHS funding, and the decision to end the two-child limit policy is made immediately, so all children really do have an equal opportunity to succeed.”

Natalie Perera, CEO of the Education Policy Institute, said that while school budgets are set to rise under the spending review, major challenges remain around funding for SEND provision and support for 16 to 19-year-olds.

“Today’s announcement signals a significant cash increase in school funding. However, given that the overall budget is rising by £4.7bn in cash terms only by 2028-29, once inflation is considered, this increase leaves less flexibility for schools than they might have hoped,” Perera said.

“The most pressing challenge is the crisis in special educational needs and disabilities (SEND) provision, and today’s settlement doesn’t appear to leave adequate funding to deliver the much-needed reforms in this area. Reforming SEND provision will require investing in highly trained support staff, adapted learning environments, and consistent, high-quality training for teachers across all schools. 

“The government has made the right decision to increase funding for post-16 providers to meet the growth in student numbers, and to focus on areas where economic growth is most needed. However, it is disappointing that there has also not been a commitment to provide new and targeted funding for disadvantaged 16–19-year-olds.”

She added: “It is also challenging to consider the impact of education funding, without clear commitments to also address child poverty. The government must prioritise publishing a child poverty strategy, and this should include funded commitments, including removing the two-child benefit cap, that will genuinely lift children out of poverty.”

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