UK Ministers Recommend Lifting Two-Child Benefit Cap to Cut Child Poverty Before Autumn Budget

Senior cabinet ministers and a government taskforce have identified lifting the two-child benefit cap as the most effective way to reduce child poverty in the UK, recommending this before the autumn budget despite the significant annual cost estimated at around £3 billion. The cap, introduced a decade ago, currently restricts child benefit payments for third or subsequent children in low-income families and has been criticized for pushing families into hardship, with studies highlighting its role in increasing child poverty and associated risks. Chancellor Rachel Reeves has expressed commitment to reducing child poverty during the current Parliament, signaling possible policy changes. However, the recommendation to lift the cap presents a financial challenge as the government faces a large public finance deficit, complicating efforts to balance spending. The issue has caused tensions within the Labour Party, with backbenchers and prominent figures like Andy Burnham advocating for scrapping the cap, while some Treasury officials favor maintaining it to control costs. The forthcoming child poverty strategy, jointly led by ministers including Pat McFadden and Bridget Phillipson, is expected to influence the party's stance and policy announcements, amid ongoing debates at the Labour conference and within government.