It is five years since the two-child limit was introduced. It restricts amounts paid to support children in universal credit, tax credits and housing benefit to the first two children in a family – a policy that is unique in European social security systems.
The UK government says the policy means families receiving benefits face the same financial choices about having children as families supporting themselves solely through work. But this wrongly assumes that all children affected by the policy are the result of family planning and born while their parents are receiving benefits. Even if this premise were correct, it would still not justify government policy exposing children to a greater risk of poverty.
New analysis by CPAG shows that in Scotland there are currently 22,000 families with 80,000 children affected by the two-child limit. 50,000 of these children are living in poverty. A joint report from CPAG, The Church of England and the Benefit Changes & Larger Families academic study provides analysis of the impact of this policy across the UK.
The impact of five years of the two-child limit policy
Since 6 April 2017 the child element is only awarded for the first two children unless the third, or subsequent child, was born before the policy was introduced. The limit can represent a loss of up £2935 per additional child per year.
What are the exceptions to the two-child limit?
Some families are exempt from the two-child limit if they meet one of the following:
- multiple births – for if the third child was born within twins or triplets (an additional amount will not be payable for one of the children born as part of a multiple birth)
- adopted children – adopted from the local authority or placed with you for adoption, but not for children adopted from abroad
- children likely to have been conceived as the result of rape or a coercive/controlling relationship
- children living with family/friends who would otherwise be at risk of going into care
But we know from our case evidence that the exceptions are not always applied correctly, or there can be difficulty ascertaining the circumstances to secure an exception. For example:
A couple gave birth to twins in 2019 so one additional child element was added to their UC award. All of the couple’s other children were born before 2017 and so were already included in the award. After a year the additional child element stopped when a change of circumstances was reported in relation to employment. DWP incorrectly told the couple that they should not have been receiving any child elements for their twins and despite numerous attempts the couple have not been able to get this element put back into payment. #1714 (16/7/21)
A grandmother is caring for her two grandchildren under a private arrangement without any social work involvement. There were already two children in the household so additional child elements will not be added to gran’s UC unless DWP grant an exception on the grounds that this is a non-parental relationship and while not formalized there would be a risk otherwise of the children going into care. DWP usually require confirmation of such arrangements from social work. #2428 (14/9/21)
Children with disabilities
Families affected by this policy do not get the child allowance for third or subsequent children, but additional amounts for disability are still payable.
A couple have twins and a young son. Mum is giving up work to care for the youngest who is disabled, so they will have to claim UC. The twins were born first, so the two-child limit will be applied. A disabled child element can be included in respect of the youngest because he receives child DLA, but not a basic child element. #1298 (17/6/21)
This policy recognises the additional cost of disability, but the family will still have to contend with a lower income than they would have if they were not subject to the two-child limit.
Often the circumstances leading to families claiming benefits could not have been foreseen when the younger children were conceived.
A woman who is pregnant with her fourth child had to leave her work recently due to ill health. She gets child tax credit for her existing three children but will not get a child element (worth up to £2935 a year) for the new baby due to the two-child limit. #1905 (4/8/21)
A dad became a lone parent to four children when his wife died. He only gets child elements in his UC for the older two children due to the two-child limit. #3839 (17/1/22)
The two-child limit policy does not take into account that family dynamics may change over time. We have a number of examples of lone parent families moving in together and losing benefit entitlement as a consequence.
A couple got together and claimed UC. They both have two children each, but only get three child elements included in their UC award because one of the children was born after 2017. The couple were not aware that the two-child limit would apply to them. #2597 (28/9/21)
The two-child policy may also cause hardship to parents taking responsibility for children from previous relationships.
A couple with two children recently took in a third child from a previous relationship. As one of the children was born after 2017, the two-child limit applies and the couple will not receive any additional UC in respect of the third child. #1625 (13/7/21)
As more children are born after 6 April 2017, more households will become subject to the two-child limit and fewer households will be subject to the benefit cap as they will not be awarded enough benefit to be capped in the first place.
We welcomed Scottish government’s commitment to better mitigate the UK government’s benefit cap but it is vital that we look ahead and consider how we can mitigate the increasing number of households that will be subject to the two-child limit as well. Better still the UK government should scrap both the two child limit and the benefit cap. Families are facing real hardship as they face the consequences of COVID-19 and the rapid rise in the cost of basic essentials. It cannot be right that the social security support they receive depends not on need, but on when a child was born or how many siblings they have.