Scrapping the two-child limit would lift more than half a million people out of absolute poverty, according to a report from the Institute for Fiscal Studies (IFS). The IFS noted that removing the two-child limit would cost the Government around £2.5 billion annually, which they described as the most effective way to reduce child poverty. However, the report also mentioned that this change would not benefit the poorest households affected by the remaining benefit cap.
The potential impact of scrapping both the two-child limit and the benefit cap would result in 620,000 children being lifted out of absolute poverty, but at a higher annual cost of over £3 billion. Prime Minister Sir Keir Starmer has faced calls to scrap the two-child policy since taking office, with some Labour MPs supporting the motion.
The Government has cited economic growth as a prerequisite for any changes to the two-child limit policy, which was introduced by the Conservatives in 2015 and implemented in 2017. The IFS report highlighted that reversing the two-child limit could lift 540,000 children out of absolute poverty, with an initial cost of £1.7 billion annually.
However, the IFS also raised concerns that scrapping the two-child limit could lead to 70,000 households being newly affected by the benefit cap. The benefit cap, introduced in 2013, ensures that households do not receive more in benefits than the cap limit allows.
Campaigners have advocated for the scrapping of both policies to help reduce child poverty. The IFS suggested that removing the benefit cap alone would benefit the poorest households, although scrapping both policies would have the most significant impact but come at a higher annual cost.
The UK government has established a Child Poverty Taskforce to address child poverty issues, with a strategy expected to be published in 2025. A Government spokesperson emphasised the commitment to reducing child poverty and supporting vulnerable families through various measures.
Official statistics revealed that millions of children in the UK are affected by the two-child limit, and a significant number of households have been impacted by the benefit cap. The IFS report highlighted the rising rates of child poverty and the challenges faced by families with three or more children.
In conclusion, the debate around the two-child limit and the benefit cap continues as policymakers grapple with the complex issue of child poverty. The IFS report sheds light on the potential benefits and challenges of scrapping these policies, emphasizing the need for a comprehensive strategy to address poverty among vulnerable families.