THE “fundamentally unjust” two-child limit on benefits will tip 300,000 children into poverty and one million impoverished children deeper into poverty by 2024, a Church of England-led report has warned.
The cap was announced in 2015 to reduce spending on working-age families. From 6 April 2017, low-income families who had a third or subsequent child lost their entitlement to additional support through child tax credit and Universal Credit, worth £2780 per child per year. A total of 264,820 children were affected in the first year.
The report, All Kids Count: The impact of the two-child limit after two years, published on Wednesday by the C of E’s Mission and Public Affairs Council and the Child Poverty Action Group, says that the limit is having a “devastating effect” on families. It estimates that 160,000 families and 600,000 children have been negatively affected to date.
Unless the policy is abolished, 1.8 million children will be living in affected families by 2024 when universal credit is expected to be fully rolled out, it estimates. This includes 300,000 children who would not otherwise be in poverty, and one million children who would be pushed further below the poverty line. It expects this to rise to about three million children (800,000 families) in future years.
More than 40 per cent of families with three or more children are already living below the poverty line. “Unless this policy is completely reversed, in the future, nearly all low-income families with three or more children will eventually be affected, as a growing proportion will include at least one child born since April 2017.”
A year after the policy was introduced, 60 bishops, including the Bishop of Durham, the Rt Revd Paul Butler, signed a letter strongly criticising the two-child limit, which, it said, would force mothers to choose “between poverty and terminating an unplanned pregnancy” (News, 13 April 2018).
Bishop Butler said on Wednesday: “We believe that children are a blessing, not a burden — and that a third or fourth child is no less precious than the first or second.
“The Government’s two-child limit goes against this fundamental principle, and is pushing many families and children into poverty. It is simply not right that some children get support and others don’t. The two-child limit must be lifted as part of a concerted effort to reverse the rise in child poverty.”
More than half of the more than 70,600 households affected by the policy (55 per cent) in its first year had three children; 27 per cent had four; 18 per cent had five or more. Most of the households affected were couples (62 per cent), and most (59 per cent) were in work.
“Due to the withdrawal of means-tested benefits as earnings increase, it is in practice very difficult for families to compensate for the loss of a child element by working additional hours,” the report states.
“A single parent with three children working 16 hours per week at the ‘national living wage’ of £8.21 per hour cannot ever compensate for the loss of a child element by increasing her hours, if she incurs childcare costs from doing so.”
Based on this data, it estimates that the policy will have a “disproportionate impact” in regions with higher-than-average concentrations of larger and poorer families: more than half of children in Bradford West (52 per cent; 18,940 children), and almost half of children in Blackley and Broughton (48 per cent; 18,700 children), for example, could be affected. Blackburn, Ipswich, Newcastle-upon-Tyne Central, and parts of Scotland, Wales, and Northern Ireland will also be disproportionately affected, including Glasgow Central, Cardiff South, and Belfast North.
The report is based on a survey of 438 families and in-depth interviews with 16 families affected by the policy. It also draws on evidence from Women’s Aid, the Refugee Council, Turn2us, and the Interlink Foundation, which work with communities who are particularly vulnerable to the benefit cap.
Almost all (95 per cent) of respondents said that the limit had affected their ability to pay for basic living costs: including food and clothing (88 per cent), gas or electric (71 per cent), rent or mortgage (41 per cent), and childcare (28 per cent).
One said: “I have debts building up on a weekly basis. . . We could easily go under if there was an emergency one week, as we have absolutely no reserves.”
Families are having to cut back on essentials and rely on family donations, credit cards, and loans in emergencies. This leads to spiralling debt, further financial strain, stress, anxiety, shame, guilt, and negative impacts on children and relationships, the report states.
“This policy is fundamentally unjust, because it fails to protect families when they experience tough times as a result of unpredictable life events, such as the breakdown of a relationship, redundancy, or the onset of disability.”
The report also expresses concern about the “non-consensual conception” exception to the policy, which applies to children who were born as a result of a sexual act to which the child’s mother did not or could not consent, or at a time when the child’s mother was in an abusive relationship.
“A policy requiring survivors to disclose and evidence domestic and sexual abuse in order to access financial support is inhumane and fundamentally unworkable. . . Many women will never disclose rape to anyone, for reasons including trauma, self-protection, shame, and fear for others — including their child.”
Refugees are also vulnerable, it says. “For refugee children, who are in dire need of support as a result of their own exposure to violence and exploitation, the effects of this policy are severe and in direct contrast to the Government’s commitment to support the most vulnerable of refugee children.”
People going through the asylum process are banned from working, are given 28 days to move on from the offered accommodation, and therefore have “no choice” but to go immediately into debt and the risk of destitution.
“Such a precarious financial position leaves them ill-equipped to manage the effects of the two-child limit, the consequences of which put them at even greater risk of severe deprivation.”