Call for ‘bold action’ at spending review over two-child cap’s link to poverty

There is a “strong correlation” between the two-child benefit cap and child poverty, a study has found, as the Prime Minister faces increasing pressure to scrap the limit.

At least one in four children is in poverty in two-thirds of the UK’s constituencies, the annual analysis from Loughborough University for the End Child Poverty Coalition found.

The campaign called for “bold action” at Chancellor Rachel Reeves’s spending review on June 11 and for the cap to be scrapped as soon as possible.

Analysis of the child poverty rate and the proportion of children affected by the two-child limit found that the two are “extremely highly correlated”, adding to evidence that the cap is a “major driver of child poverty across the UK”.

Universal credit

The policy means parents only receive support for up to two children through the universal credit system.

In the North East, West Midlands and Wales, around nine out of 10 constituencies were found to have a child poverty rate higher than one in four.

Birmingham Ladywood, Dewsbury and Batley and Bradford West were among those with the highest rates.

The analysis looks at poverty rates after housing costs, whereas UK Government data shows poverty levels before housing costs are calculated.

Sir Keir and the Chancellor are under pressure to respond to mounting calls for the two-child benefit cap to be axed at a cost of around £3.5 billion.

Ministers have reportedly been considering scrapping it as part of their child poverty strategy, which was due to be published in the spring but is now set to come out in the autumn so it can be aligned with the Chancellor’s budget.

‘Bleak’

Dan Paskins, vice-chairman of the End Child Poverty Coalition, said the data presents a “bleak picture of life” for the UK’s children.

“A record number are now in poverty and this is under the noses of our MPs, particularly Cabinet members. 80% of Keir Starmer’s Cabinet represent constituencies with higher-than-average child poverty rates.

“The time for action is now, and the Comprehensive Spending Review and forthcoming child poverty strategy should involve bold action.

“Due to the analysis’s finding (of) a strong correlation between child poverty rates in local areas and the number of children impacted by the two-child limit to universal credit, it is essential this policy is scrapped as soon as possible.”