The Resolution Foundation has warned that failing to scrap the two-child benefit limit in full would undermine the government's child poverty ambitions and could lead to levels of hardship not seen under a Labour government for over 50 years. The thinktank's analysis indicates that half-measures, such as lifting the limit only for working families, would have little or no meaningful impact on child poverty rates.
According to the Resolution Foundation, abolishing the two-child cap entirely would immediately lift 330,000 children out of poverty and prevent a further 150,000 from falling into poverty by 2029-30. The policy, introduced by the Conservatives in 2017, restricts welfare payments for third and subsequent children, affecting around 1.7 million children.
The thinktank argues that without full abolition, child poverty is set to rise by more than half a percentage point annually over this parliament, which would be the worst record for any Labour-led government in over 60 years. It stresses that no credible child poverty strategy can exist without significant additional state support for family incomes.
Education Secretary Bridget Phillipson has described scrapping the two-child limit as the most cost-effective way to improve life chances for disadvantaged children. However, the Treasury has been exploring partial repeal options, including raising the limit to three or four children or introducing tapered payments. The Resolution Foundation says these compromises would still leave child poverty rates higher at the end of the parliament than at the start.
The government has committed to publishing an ambitious child poverty strategy in November, and has already invested £500m in children's development through the rollout of Best Start grants. A government spokesperson reiterated the commitment to tackling the structural causes of child poverty but did not confirm whether the two-child cap would be abolished.
