Two-child benefit cap could be scrapped as 1.6million children miss out on £288 a month
EDUCATION Secretary Bridget Phillipson has said the government will “consider” removing the two-child benefit cap “as one of a number of ways” of helping children out of poverty.
It comes weeks after The Sun revealed that government would not rule out scrapping the measure which limits the amount of financial support families can receive to just two kids.
“We will look at every measure in terms of how we can address this terrible blight that scars the life chances of too many children,” Bridget told viewers of Sky News this morning.
She went on to say that scrapping the cap would be “very expensive” but it would need to be reviewed as “one of a number of levers in terms of how we make sure we lift children out of poverty”.
Removal of the two child benefit cap would provide a boost to many households, who are struggling amid the cost of living crisis.
A report from the Department for Work and Pensions (DWP) showed that 1.6million children are now missing out on up to £288 a month in extra support.
Child Poverty Action Group also said recently that scrapping the two-child limit would lift 300,000 children out of poverty and mean 700,000 children are in less deep poverty.
But chancellor Rachel Reeves has resisted pressure from her peers to abolish the cap, claiming she would not make “unfunded pledges”.
She told the BBC yesterday that she could not pledge to do so without saying where the £3bn annual cost from removing the measure “is going to come from”.
“We were really clear during the election that we were not going to make spending commitments without being able to say where the money was going to come from,” she added.
“If we’re not able to say where the money is going to come from, we can’t promise to do it. That’s true when it comes to the two-child limit and anything else.”
She went on to say that government plans to bring in new workers’ rights, breakfast clubs in primary schools and creating new nursery places were evidence that Labour was still committed to helping children in poverty.
It echos claims from Sir Keir Starmer who said before the general election that his government would not be able to afford to scrap the cap if it won the election.
Taking questions after a questions after his speech at the Farnborough International Airshow this morning, the PM said Labour’s child poverty strategy “covers all the bases” to tackle the issue.
He said: “I’m not surprised that there’s a real passion about this in the Labour Party, you’d expect there to be.
“Child poverty is something that we need to eradicate. And there’s a very strong feeling in the Labour Party, labour movement about that.”
“That is precisely why I set up the taskforce to tackle child poverty. There is no silver bullet. If there was a silver bullet it would have been shot a very long time ago.”
He added that there was a “complicated set of factors” including pay, benefits, work, housing, education and health “and that is why you need a strategy to deal with it”.
However, government insiders have previously told The Sun the government will consider removing the cap when it can afford to do so, and they refused to rule out scrapping it during this term.
Prime Minister Keir Starmer has faced pressure from the Labour back bench to commit to scrapping the policy.
Deputy Prime Minister Angela Rayner has previously called the cap “inhumane”.
Around 59% of families affected by the policy contain at least one working parent.
Who's exempt from the two-child benefit cap?
THE two-child benefit cap means that you can only get more child tax credit or Universal Credit for your third (or more) child if:
- They were born before April 6, 2017
- They are disabled (disabled child element only)
- You qualify for an exception in child tax credit or special circumstances apply in Universal Credit
You qualify for an exception or special circumstances for each third (or subsequent) child if:
- You have adopted them or other children in your household
- You receive guardian’s allowance for them or other children in your household
- They are the second (or more) child born in a multiple-birth
- They or other children in your household are the offspring of one of your children who is under 16 years old
- They or other children in your household are not your child or stepchild, and you look after them under a court order
- They or other children in your household are not your child or stepchild and you look after them under an arrangement with Social Services (except for formal foster care)
- They were conceived as a result of rape, and you do not live with the perpetrator
ADDITIONAL CHILDCARE HELP
Up to 30 free childcare hours
You may be able to get free childcare for your child aged nine months to four years old if you live in England.
The number of hours working parents can claim depends on the age of their child.
If your child is:
- Nine months to two years old, you can get 15 hours per week of free childcare
- Three to four years old, you can get 30 hours per week of free childcare
From September 2025, children aged nine months to two years old will qualify for 30 hours per week of free childcare
To qualify, you’ll need to earn at least the equivalent of the national minimum wage for 16 hours a week.
Both parents will need to earn the equivalent of at least £166 per week, each with a taxable income of no more than £100,000.
Your two-year-old can also get free childcare if you live in England and get any of the following benefits:
- Income support
- income-based jobseeker’s allowance (JSA)
- income-related employment and support allowance (ESA)
- Universal Credit and your household income is £15,400 a year or less after tax, not including benefit payments
- The guaranteed element of pension credit
- Child tax credit, working tax credit (or both), and your household income is £16,190 a year or less before tax
Universal Credit childcare costs
Parents on Universal Credit and in a paid job can have up to 85% of their childcare costs covered, up to £1,014.63 a month for one child and £1,739.37 a month for two or more children.
It doesn’t matter how many hours you work.
If you live with a partner, you both need to work to qualify.
You usually have to pay for the childcare and claim back the costs, but if you go back to work or increase your hours you can request for the money to be paid upfront.
Child benefit
You can get child benefit if you’re responsible for a child aged under 16, or if they are under 20 and in approved education or training.
Child benefit is currently worth £25.60 a week for the eldest child or only child. For each subsequent child, parents get £16.95 a week.
The cash is paid every four weeks and there’s no limit to how many children you can apply for.
Bear in mind though, that those who earn more than £60,000 a year have to start paying back some of their child benefit through the High Income Child Benefit Charge (HICBC).
If you or your partner earns £80,000 or more, you have to pay all your entitlement back.
You have to pay the HICBC to HMRC through self-assessment.
How to claim Child Benefit
Child benefit is worth up to £1,331 a year for your first or only child and up to £881 a year for additional children.
This works out at £102.40 every four weeks or £25.60 a week for your first child and £67.80 every 4 weeks or £16.95 a week for their siblings.
There is no limit on the number of children that can be claimed for.
Applying is straightforward and can be done in minutes at gov.uk or through the HMRC app.
Parents with a newborn baby should make a claim online as soon as possible and could then receive their first payment in as little as three days.
You can also backdate claims for up to three months.
Parents can make a claim and then choose to opt out of receiving Child Benefit payments can still receive National Insurance credits if one parent is not working.
National Insurance credits build up your entitlement to the state pension.
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