Fears benefit cap will 'push 200,000 more children into poverty'

03 May 2017

New limits being imposed on benefit payments could force 200,000 more children into poverty, campaigners fear.

Changes that came into force on 6 April will see the payment of some benefits limited to the first two children in a family.

They affect families who claim tax credits and universal credit, which is set to replace tax credits by 2022.

The Child Poverty Action Group (CPAG)and Institute for Public Policy Research claim some families will be almost £3000 per year worse off under the changes.

The new rules state that for children born after 6 April into families where there are already at least two children will no longer be counted in tax credit or universal credit payments to their parents.

From autumn 2018, families making new universal credit claims will only be eligible for payment for their first two children – even if they were born before this date – although child benefit will remain unaffected by the changes. 

The latest data shows that 872,000 families with more than two children were claiming tax credits in 2014-15.

In the same period, 65% were working families and 68% had no more than three children.

The researchers calculated that, based on these figures, an additional 100,000 adults and 200,000 children could face poverty once the new rules are fully implemented.

CPAG chief executive Alison Garnham called the change ‘particularly pernicious’, adding that children ‘should not have their life chances damaged because of the number of siblings they have’.

A spokeswoman for the Department for Work and Pensions said that ‘work is the best route out of poverty’ and that welfare reforms ‘are designed to support people into employment’.