Universal Credit (Removal of Two Child Limit) Bill

Baroness Dacres of Lewisham Excerpts

Thursday 12th March 2026 Lords Chamber

[Baroness Dacres of Lewisham (Lab)]

My Lords, before I begin my substantive contribution to this debate, I want to pay tribute to those who have made their maiden speeches this afternoon. It has been wonderful to learn so much more about each of them and inspiring to hear them.

This Bill represents one of the clearest and most immediate steps we can take to reduce child poverty in this Parliament. Few policies in recent years have had such a direct and concentrated impact on larger families as the two-child limit. Its removal is therefore not just symbolic; it is practical, targeted and necessary. Around 470,000 households are affected by the two-child limit, impacting between 1.6 million and 1.7 million children. Six in 10 of those households include at least one adult in work. These are working families, as many have mentioned this afternoon. The parents rise early, commute long distances, juggle childcare and shifts, and contribute daily to our economy and our communities. Yet despite those efforts, many remain in poverty. That is a reality of in-work poverty today.

Families lose around £3,400 for each third or subsequent child not covered by the child element. For households already balancing tight budgets, that loss is not abstract; it means difficult trade-offs between heating and eating, falling behind on rent or relying on food banks. Behind every statistic is a family trying to provide stability and reassurance to children while quietly carrying the financial strain. The Joseph Rowntree Foundation has consistently identified the two-child limit as a key structural driver of rising poverty among larger families. Its research shows that children in families with three or more children now face poverty rates exceeding 40% after household costs. Poverty among larger families has risen markedly since the introduction of this policy, widening inequality between children based purely on their family size.

Joseph Rowntree Foundation modelling demonstrates that removing the two-child limit would significantly improve living standards for the lowest-income households. Scrapping the limit would more than halve the projected real-terms decline in income for the poorest third of households compared with retaining it. Government analysis similarly indicates that hundreds of thousands of children would be lifted out of relative poverty.

The Bill also sits within a broader effort to support families and strengthen living standards. It complements the expansion of free breakfast clubs, saving parents up to £450 a year, and the extension of free school meals to all children of households on universal credit, benefiting half a million more pupils. That broader approach matters because poverty is rarely the result of one single factor; it is shaped by wages, housing costs, food prices, childcare pressures and access to opportunity. Addressing it therefore requires income support and practical support, nutritious food at the start of the school day, predictable childcare that enables parents to work, and a social security system that reflects the real cost of living.

The heart of this legislation affirms a simple but vital principle that no child’s opportunity should be limited by the number of siblings they have, and that working families deserve stability, dignity and fairness. The measures before us today will not solve every challenge faced by families, but they will make a real difference to the lives of many children across this country—a responsibility worthy of this House. For those reasons, I support the Bill.