MPs celebrate end of two-child benefit cap despite voting not to scrap it last year

Chancellor Rachel Reeves is scrapping the two-child benefit cap. Photograph: Ugur Akdemir / Unsplash

Labour MPs have celebrated the end of the two-child benefit cap policy despite voting not to scrap it last year.

Rachel Reeves announced in her Budget on Wednesday (26 November) the two-child benefit cap will be scrapped, with the policy coming into effect in April 2026.

Previously, almost all parents were prevented from claiming Universal Credit for more than two children.

The move is expected to lift 450,000 children out of poverty, including 15,480 in Hackney.

The borough has some of the highest rates of child poverty in England.

The Citizen previously reported almost two thirds of children in Hackney live in income deprivation – the second-highest in the country.

Wednesday’s announcement will come as welcome news to cash-strapped families across the borough and the rest of the UK.

However, MPs previously overwhelmingly voted against a motion by the Scottish National Party (SNP) to scrap the two-child benefit cap – including Rachel Reeves.

In July 2024, an amendment to the King’s Speech was tabled in the name of SNP Westminster leader Stephen Flynn, stating that it “fails to include immediate measures to abolish the two-child benefit limit to universal credit.”

The House of Commons voted by 363-103 to reject the amendment.

These included Dame Meg Hillier, Labour (Co-op) MP for Hackney South and Shoreditch; deputy prime minister David Lammy, who is the Labour MP for Tottenham (including Woodberry Down and Brownswood wards); and Emily Thornberry, Labour MP for Islington South and Finsbury (including De Beauvoir ward).

No vote was recorded for independent Hackney North & Stoke Newington MP Diane Abbott.

But earlier this year, Hillier, who chairs the Treasury select committee, said ending the cap made economic sense long-term and was the right thing to do morally.

“If we lift the cap, that’s 350,000 children immediately out of poverty and, crucially, 700,000 out of deep poverty in one fell swoop,” she said in September.

“It is the single, quickest measure to deliver the results we need to see.”

Just seven Labour MPs voted against the government on the motion last year.

Ex-shadow chancellor John McDonnell, along with Zarah Sultana, Apsana Begum, Richard Burgon, Ian Byrne, Imran Hussain and Rebecca Long Bailey had the whip suspended for six months following the vote.

McDonnell and Begum became the latest to be readmitted to the party in September.

Six of the MPs have now rejoined, while Sultana resigned in July of this year and co-founded Your Party with former Labour leader Jeremy Corbyn.

Dame Meg Hillier told the Citizen: “In Hackney, one in two children live in poverty after housing costs are taken into account. I regularly visit people’s homes and see first hand the impact this is having.

“Child poverty and all it entails – the skipped meals, the freezing home, the school uniform that does not quite fit – is a painful reality for too many in Hackney and across the country.

“It stunts development, limits opportunities, and chokes future growth.

“A child growing up in poverty is less likely to work as an adult and earns 25 per cent less aged 30. There is no poverty of ambition in Hackney’s young people and they must be supported properly and invested in for the future.

“Reducing child poverty has always been a priority for me, and was a Labour manifesto commitment.

“I am proud that a Labour government has been able to deliver this.”

The Citizen has contacted David Lammy, Diane Abbott, Emily Thornberry and the Chancellor of the Exchequer for comment.