Two-child limit turning the screw on families in cost of living crisis

• Survey finds deep hardship after 6 years of the policy

On the sixth anniversary of the two-child limit, a Child Poverty Action Group (CPAG) survey finds widespread suffering and hardship among families affected by the policy with parents struggling to meet children’s basic needs as living costs soar.

The two-child limit restricts child allowances in universal credit (UC) and tax credits (worth up to £3,235 a year) to the first two children in a family, unless the children were born before April 2017 when the policy was introduced.

CPAG’s rolling survey, which since 2019 has collected 3,000-plus responses from parents subject to the limit, records a sharp rise in the number of families reporting that the policy has affected their ability to pay for gas and electricity, despite government intervention – from 73% in 2021/22 to 82% in 2022/23.

The number of working families affected by the policy who report that it has affected their ability to pay for food has risen from 78% in 2021/22 to 87% in 2022/23. The rate among non-working households has consistently reached 90% since 2019.

Most families (58%) subject to the policy are working and CPAG estimates 1.5million children are currently affected by it, including 1.1 million growing up in poverty*. 

The impact of the policy on families’ budgets has been compounded by the cost-of-living crisis. While the Government has provided support with living costs for low-income households, the payments are flat-rate and therefore take no account of children in a household. And although benefits will increase in-line with inflation this month, the continued application of the two-child limit means affected families will still be well short of what they need.

Parents responding to the survey who have had a third or subsequent child in the past year or have completed the survey in the past year report:

Children are losing out:

I am currently on maternity leave and can’t afford to stay at home for the full 39 weeks due to not receiving any extra help from tax credits as this is my 3rd child. I am struggling to buy food and heat the home whilst just on statutory maternity pay so I will have to return to work before my baby is 5 months old. I am exclusively breast feeding and my baby won’t be weened till 6 months so I’m having to express all the time now to freeze milk ready for my return to work. This means I can’t spend as much quality time bonding with my new baby as I’m worried about him not being able to have milk when I return to work as I can’t afford to buy formula

[Two of my children] are allergic to milk and wheat and not having the extra funds has stopped me from buying “free-from” as its expensive. Sometimes I'm sat with no gas not able to wash properly and sat in the cold

...my baby is only 2 months old and I am already looking to go back to work full time. This isn’t fair, I should be able to enjoy the first year with my baby and not have to worry about how I am going to afford to feed them. There are days I don’t eat so that my children can, they are my main priority... I just don’t understand how there is no help for a 3rd child, does she not matter as much as my other two? This has affected my mental health massively and I have always been a positive person.

Unable to make ends meet:

I now find myself struggling to put food on the table. I couldn’t even bear to think what will happen when I run out of oil heating which i know will happen soon... I’m really, really struggling

I work full time, my wife cares for our children and my elderly mother. We are doing everything right and yet we can’t afford the basics

We can't afford much. Literally living hand to mouth, everything has gone up. Have one meal a day as a parent so kids don't go without

It would have been nice to be able to afford clothes and other basics. We are going to really struggle when our third child starts eating food.

When we decided to have a 3rd child we were comfortable, but by no means rich. We were frugal. Saved all clothes, toys cots and re-used everything we could, for all children. We knew we could afford a 3rd child on our wages and also childcare to enable me to go back to work part time. The cost of living crisis has made our outgoings considerably more in the year since she was born. ...My partner works 40 hours a week and I work at least 20 yet we are struggling to feed our children and keep them warm...

Families going into debt:

I have had to change my job as we couldn’t afford childcare for the baby. Now I’m working less & we are having to choose between heating & eating. I had to take a loan to buy my older children’s school uniforms. My trainers are held together by super glue coz any spare money goes on the children.

... I’ve sold all my jewellery to cover expenses ...then as for working, trying to find a job around kids hours and holidays is so hard and its ok saying work nights [but] where will i place my children? I’m trying so hard to make ends meet... I’ve borrowed more this past 9 months than i have in my entire life ... i would never let my kids go without heating or hot water or food and nutrition - their health and needs is my priority - if it means me missing meals so be it

Mental health suffers:

...my kids and I really struggle with food costs and it's not for the want of trying to provide myself, I can’t work anymore hours than what I am doing... it’s affecting me physically and mentally, I go without so my kids get breakfast and a packed lunch each day. It's demoralising, depressing and embarrassing. I love my children unconditionally but love doesn't fill their bellies and provide a warm safe roof above their heads. 

My children that are in school are missing out with their friends as I can't afford any extra money for the after school clubs they want to go to or even their friends birthday parties so now they are being left out and not asked. But I have to put bills and food/ oil first! ... I'm behind in my rent by hundreds. It's really stressful and gets me down and I feel like I'm failing my children..

Abolishing the two-child limit would lift 250,000 children out of poverty, and a further 850,000 children would be in less deep poverty at cost of just £1.3 billion. Unless the policy is abolished, the number of children affected will reach 3 million, as more children are born under the policy.

Chief Executive of Child Poverty Action Group Alison Garnham said:

Six years to the day since this nastiest of policies came into effect, our survey is showing its devastating effects. The two-child limit makes it impossible for parents to provide their children with essentials – and the cost of living crisis is adding extra pain. The number of children in poverty rose by 350,000 last year – and the two-child limit played a big part in that rise. There is no place for this policy in a country that believes all children deserve a good start. Ministers must remove it before it does more damage to children and to family life.

A new CPAG briefing (embargoed until 06.04) marking six years of the two-child limit is here.

Notes to Editors:

*The 1.5 million children includes all children in a family subject to the limit rather than only the particular third or subsequent child who is ineligible for support as a result of the policy.

CPAG’s two-child limit survey has been running since 2019 and uses the Entitledto benefits calculator to identify tax credit or universal credit claimants who had a third or subsequent child since April 6th 2017. Respondents are invited to complete a short online survey about the impact of the policy on their family. 

CPAG media contact: Jane Ahrends 07816 909302.