Around 165,000 British families are now affected by the Department for Work and Pensions (DWP) benefit cap, an increase of more than 50,000 from previous figures, according to data published by the DWP in September.
The figures show that over 370,000 people are impacted by the welfare cap, which limits the total amount of benefits a household can receive. Almost all of the capped households are on Universal Credit.
Sharp rise in capped households
The number of capped households has risen by 53,000 (48%) compared with February 2026 and increased by 47,000 (41%) compared with May 2025. Campaigners attribute the increase to the recent scrapping of the separate two-child limit policy.
Iain Porter, of the Joseph Rowntree Foundation (JRF), warned: "The benefit cap means £80 a week on average deducted from already inadequate Universal Credit payments, leaving families unable to afford essentials like food/energy. These deductions hamper +ive impact of removing 2-child limit, as families are hit by benefit cap instead."
Call for protected minimum floor
He added: "A Protected Minimum Floor in UC would be a quick/pragmatic fix, providing breathing space to children facing the deepest poverty. This would build on Fair Repayment Rate which limits debt deductions to 15% of basic UC, extending it to benefit cap deductions too."
The most common number of children in a capped household is 3, compared with 2 in February 2026 and 2 in May 2025. Around 2.3% of working age households claiming UC had their benefits capped, compared with 1.5% in February 2026.
Impact on families
The JRF added: "A protected minimum floor below UC’s standard allowance would be a bold new popular policy that would immediately limit the deepest hardship caused by debt deductions and the benefit cap, particularly for families with children.
"The Government could implement this quickly by building on its introduction of the Fair Repayment Rate, which limits total debt deductions from UC to 15% of the standard allowance.
"Extending this principle to all deductions, including the benefit cap, would reduce hardship and deep child poverty even further and create a protected minimum floor 15% below UC’s current standard allowance."
This would mean the amount of standard allowance (net of these deductions) could not fall below a floor level of £83 a week for a household headed by a single adult aged 25 or over in 2026/27.
"A protected minimum floor would embed for the first time the principle of a safety net below which no one should fall. This framing could bring political advantage that is harder to achieve from references to obscure debt deduction rules, or the politically challenging removal of the benefit cap.
"The Labour Government of 1997, with the creation of the minimum wage, inserted a wage floor into the labour market with lasting impact on the living standards of low earners.
"This bold and positive policy would carry an echo of that earlier policy, by creating a floor to protect the incomes of the worst off."
