New research shows affected families can’t afford what they need for their kids. 59% (210,000) families caught by the limit are working. Today’s first instalment of cost-of-living emergency payment won’t do enough.
The Universal Credit (Removal of the Two Child Limit) Bill is a Private Members’ Bill brought forward by the Lord Bishop of Durham to remove the limit in universal credit (UC) that restricts support to just the first two children in a family. The second reading will take place on Friday 8 July.
This briefing summaries the findings of two papers from the Benefit Changes and Larger Families research study which explore whether the two-child limit has affected families’ decisions about how many children to have.
Last month, chancellor Rishi Sunak stood before the dispatch box and delivered his third and most significant budgetary response to the current cost of living crisis. As he announced the measures, he pledged: 'We need to make sure that for those whom the struggle is too hard…and for whom the risks are too great…they are supported… We will make sure the most vulnerable and the least well off get the support they need at this time of difficulty.'
The Queen’s Speech was a missed opportunity for the government to introduce legislation that would support people in the short term and improve living standards in the longer term.
Under the two-child limit, parents are not entitled to any extra support through universal credit or child tax credit to help with raising a third or subsequent child born after 6 April 2017. This means they lose out on up to £2,935 a year, and puts families’ budgets under enormous strain. Five years after the introduction of the two-child limit, an estimated 1.4 million children in 400,000 families are now affected by the policy. Unless it is abolished, the number of children affected will reach 3 million, as more children are born under the policy.
Universal credit (UC) is now the main working-age benefit in the UK. Since its inception, UC has been plagued with administrative issues and budget cuts and, as a result, its early promise to reduce poverty has yet to be realised. When the pandemic hit, swift changes were needed to make UC fit for purpose including an increase in the amount of financial support provided and a relaxation of some of its most punitive rules. However, the vast majority of these positive changes have already been reversed, or are due to be reversed in the coming months.
This report draws on evidence from studies of minimum household costs in London to comment on the size of differences in children’s costs in various categories. This analysis builds on new research on a ‘Minimum Income Standard for London’.
This joint report from CPAG, the Church of England and the Welfare Reform and Larger Families research project presents the latest estimates of the number of families affected by the two-child limit, and provides an insight into the impact of the policy using survey data from families directly affected by it. It is a continuation of a series of annual reports tracking the impact of this policy over time.