The UK government is under increasing pressure to address child poverty. A national modelling taskforce, headed by Bridget Phillipson, the Shadow Secretary of State for Education, and Work and Pensions Secretary Liz Kendall, is calculating the effects of the controversial two-child benefit limit. Right now, an estimated 1.6 million children are growing up in households penalized by this counterproductive policy. This punitive policy limits means-tested benefits to the first two children in each family for all children born after April 2017.
The Institute for Fiscal Studies (IFS) estimates that abolishing the two-child benefit cap would cost the government around £3.4 billion annually. Yet, such a step would go a long way towards reducing child poverty, raising around 500,000 children above the threshold of relative poverty. The joint Labour-Conservative taskforce was established last year after pressures from opposition parties and a number of Labour MPs to lift the cap. This fall, it will release a plan to address the crisis of child poverty.
Phillipson illuminated the need for a two-child benefit cap. He added that it’s far from the only productive education policy that could provide meaningful support to families. She shone a light on other initiatives too, such as the roll-out of family hubs, free school meals, breakfast clubs and childcare provision.
“We are the party that believes in work. We don’t believe that welfare should trap people.” – Bridget Phillipson
Appearing on BBC One’s Sunday With Laura Kuenssberg to discuss the new plan, Phillipson insisted that ministers are currently considering all alternatives. In so doing, they aim to raise children above the poverty line. This holistic approach gets to the heart of the matter, the root causes of child poverty. It uses a multi-pronged approach rather than solely changing welfare policies.
We were encouraged by the Conservatives’ response to growing calls for mental health benefits. They cited a report by the Centre for Social Justice which argues that reducing these benefits to all but the most extreme cases could save the government £7.4 billion a year by 2030. The IFS analysis unveils a pretty remarkable trend. Over 54% of the net rise in people aged 16-64 receiving disability benefits since the outset of the COVID-19 pandemic is attributable to mental health or behavioral conditions.
Chancellor Rachel Reeves is facing mounting pressure ahead of the high-stakes autumn Budget. This pressure is exacerbated by the government’s recent announcement to roll back welfare reforms. Our health and disability benefits bill is on track to exceed £70 billion per year by the end of this decade. Even so, officials are raising the alarm, deeming such high levels of spending “unsustainable.”
Mel Stride, a government minister, criticized previous choices made by the government, asserting that more could be done to reduce the growing benefits bill. National and state policymakers and experts have been recently discussing various strategies to combat child poverty. A big part of these talks is the impact of keeping or removing the two-child benefit cap.
Besides political ramifications, Phillipson stressed the need to gauge the cap’s impact. The Labour Party is committed to a full comprehensive consideration of all approaches to address child poverty.
“But all of that said, we will look at this collectively in terms of all of the ways that we can lift children out of poverty.” – Bridget Phillipson
