Labour opens door to scrapping two-child benefit cap

Government says team of ministers will have ‘all available levers’ to achieve its goals as child poverty taskforce begins work

The Government has opened the door to scrapping the two-child benefit cap following the first meeting of its child poverty taskforce.
It said on Wednesday that the newly assembled team of ministers will consider potential social security reforms to alleviate poverty as part of its work to support disadvantaged children.
It is understood that this will cover “all available levers”, including abolishing the two-child limit, following pressure from Left-wing MPs.
Campaigners have argued the change would be the single most cost-effective way of curbing child poverty in the UK.
The news will come as a boost to MPs on the Left of the party who have been piling pressure on Sir Keir Starmer to ditch the “cruel” policy.
It formed the basis of the first rebellion after he became Prime Minister, with seven Labour MPs stripped of the whip for backing an SNP amendment demanding an end to the cap.
The two-child limit was introduced by Lord Cameron but did not come into effect until 2017, by which time Theresa May was prime minister.
It prevents parents from claiming child tax credit or universal credit for their third and any subsequent children.
Sir Keir said on multiple occasions during the election campaign that his Government would not scrap the cap because of the economic implications.
He stood firm on it when he entered No 10, with no mention of the policy in the King’s Speech, which set out the legislative agenda for the coming year.
But in the wake of the early rebellion from Left-wing MPs, the Government has said all levers to address child poverty are under consideration.
The suggestion the cap might be scrapped comes as Rachel Reeves, the Chancellor, is set to face further pressure from the Left in the run-up to her first Budget in the Autumn.
In its terms of reference for the taskforce, published on Wednesday, the Government said that ministers would harness “all available levers to drive forward short-term and long-term actions across government to reduce child poverty”.
This will be achieved by “supporting households to increase their income including considering social security reforms that support people into work and alleviate poverty”.
The taskforce will also look at how to bring down essential household costs, build savings and tackle problem debt.
It will publish its strategy for tackling child poverty early next year.
Figures published last month revealed that 1.6 million children are affected by the two-child limit, with about 450,000 families left unable to claim for their third child in April.
Liz Kendall, the Work and Pensions Secretary, said: “Child poverty is a scar on our society. It harms children’s life chances and our country as a whole. That is why tackling child poverty is a top priority for this Government.
“We will take action in every department, with a comprehensive strategy to drive down poverty and drive up opportunity, building a better future for us all.”