Universal Credit (Removal of Two Child Limit) Bill

Viscount Younger of Leckie Excerpts

Thursday 12th March 2026 Lords Chamber

[Viscount Younger of Leckie (Con)]

My Lords, in winding up for the Opposition, I say that we have had three remarkable maiden speeches this afternoon. I will make a few comments about each.

I am so pleased that the noble Baroness, Lady Teather, has recovered and regained her voice. I have no doubt that we will be hearing much of it. I hope that she will rejoin the Parliament Choir; I declare my interest as a tenor in the choir.

I applaud the clear energy, entrepreneurship and communication skills of the noble Lord, Lord Walker of Broxton. I acknowledge that he provides employment to many in the retail sector. I have no doubt that he will have much to offer from his high street experiences and, as he said himself, a fresh way of thinking, however that can be defined.

The noble Baroness, Lady Antrobus, delivered an excellent maiden speech. She will be invaluable in using her experience and knowledge of the Armed Forces, both in the air and terrestrially, in contributing to the House. We have been very lucky this afternoon.

I thank all other noble Lords who contributed to this debate and set out their views with such conviction on what is—in my view and in our view on this side—a deeply mistaken policy. I say that as someone who is proud of the compassion that defines this country. The British people are generous, fair-minded and instinctively willing to help those in genuine need. That spirit of neighbourliness and of looking out for one another is something we should always cherish and protect. The noble Baroness, Lady Teather, is right: handling language and collaboration and getting these matters right are important factors in communities, where matters can be extremely sensitive.

However, compassion must also be balanced with fairness, as my noble friend Lady Jenkin alluded to. I am afraid that this policy tips that balance too far the other way. It asks those who work hard, pay their taxes and support the system to shoulder ever-greater burdens while expanding reliance on the state in a way that risks undermining the very foundations that sustain it.

It would be easy for me to say that raising the cap would be the right thing to do, and I was very pleased to note that the right reverend Prelate the Bishop of Leicester and, indeed, my noble friend Lord Redwood acknowledge that we all want to reduce child poverty—I personally want to, we all want to, but how we do it continues to divide opinion; that much I think we can agree on.

I was struck by the remarks from the noble Lord, Lord Bird, in his powerful speech. I believe his clarion call for greater social mobility is a key point: a hand up, perhaps, to a better future—or, indeed, to any future for those who are really wallowing in poverty, particularly children. The noble Lord, Lord Watson, echoed this sentiment.

As my noble friend Lady Stedman-Scott set out, it cannot be right that parents who do the responsible thing, who go out to work, contribute to our economy, and carefully manage what they can afford for their families, are expected to fund a system in which others face far fewer of those same constraints. At its heart, that is the problem with the Bill: it seeks to address a serious issue but does so in the wrong way. In trying to demonstrate compassion, it risks undermining fairness and, without fairness, surely public confidence in the welfare system itself will begin to erode. Is it any wonder that an overwhelming majority of the country oppose this policy, as my noble friend Lady Stedman-Scott said?

This policy comes at a time when our welfare system is facing what can be described only as a mounting crisis. At the Spring Statement, the OBR confirmed that welfare spending is set to rise by £74 billion over the next five years. Forecasts also show that spending on health and disability benefits alone will be £1.3 billion higher than previously expected. At the same time, the economic outlook is deteriorating. The OBR now forecasts unemployment reaching 5.3%, higher than the 4.9% peak predicted only at the time of the Budget.

Despite the Chancellor’s repeated claims of responsible fiscal management and careful stewardship of the public finances, the reality is that welfare spending continues to surge. The total welfare bill will rise by £18 billion this year alone, then by roughly £15 billion every year across the forecast period. In total, the OBR expects the Government to spend £333 billion on welfare this year—10.9% of our entire economy. By 2030-31, that figure is projected to reach £407 billion—11.7% of GDP. The think tank Onward has warned that on this trajectory welfare payments will, in effect, cost individual taxpayers around £3,000 a year by the end of the decade as Britain’s benefit system edges towards becoming unsustainable.

The noble Baroness, Lady Sherlock, stated in her opening remarks that some think it is all about cost. Cost is a big factor, but it is not the only one, and I make the point that other benefits are there, including for larger families, to help with essential household needs, such as the household support fund directed through local authorities.

I understand the points the noble Lord, Lord Babudu, and the noble Baroness, Lady Sherlock, made about those being in work making decisions at that time about family size and then finding themselves out of work—that is an obvious and important point—and the need, which I feel strongly about, to support single-parent families.

My noble friend Lord Redwood eloquently iterated that there are other reasons why children wallow in poverty, such as dysfunctional family life and, as he said, which is very important, a lack of love. The noble Lord, Lord Sikka, made the very important point about the need for better pastoral help for parents. Handouts are not just the key. In short, the system is lurching in the wrong direction. Costs are already enormous and continue to climb at the same time as unemployment is expected to rise. This is simply not a sustainable position.

We must remember who ultimately bears that cost. An additional £3,000 a year does not fall on some abstract entity called the taxpayer, but on ordinary working people—teachers, nurses, those who work in the retail sector and families who rise early, work long hours and try to balance their household budgets without the benefit of generous state support. These are not the super-rich; they are the people who make up the backbone of our country. Before we expand the welfare state still further, we should at least ask ourselves what burden we are asking them to carry. I am not convinced that the Government have asked a question more searching than how they can placate their Back-Benchers for another few weeks. My noble friend Lady Stedman-Scott was absolutely right to point that out. It has to be said, although I see the Minister shaking her head.

My noble friend Lady Stedman-Scott set out clearly the fundamental flaw in the Government’s logic. Ever-increasing welfare spending does not solve poverty; it helps conceal it. A welfare offer of this scale risks doing something else far more damaging. It will begin to erode the very foundations on which the welfare system depends. The system ultimately relies on a balance—a word we have heard this afternoon. Those who can work do so, and through their work they support a safety net for those who genuinely cannot.

However, that balance is now under real strain. Welfare spending is forecast to rise by around a fifth over the next five years, at the same time as one in five working-age adults is not in work. We are well aware of those statistics. That trajectory should concern all of us. The welfare state was never intended to become an alternative to work. If too many people come to rely on benefits rather than the rewards of employment, the model will simply cease to function. I was struck by the strong points made by the noble Lord, Lord Walker, in this area. The system depends on contribution as well as support.

Yet instead of confronting that challenge, the Government’s response has been to step away from reform and move in the opposite direction, expanding spending commitments that the public finances can scarcely sustain. A welfare system that discourages work does not reduce poverty in the long term but risks entrenching it. If we are serious about giving people the best chance of a secure and independent life, that is a reality we cannot afford to ignore. This policy tips that balance even further in the wrong direction and the Government should be really concerned about the long-term effects that it risks having on our public finances and the welfare system as a whole. Labour Back-Benchers, I fear, are too wedded to the idea of the welfare state. It is akin to somebody inching their way along the branch of a tree further and further until it snaps.

When we step back from the detail of this debate, the question before us is very simple: what kind of welfare system do we want for this country? Do we want a system that is fair to those who fund it, sustainable for the long term and focused above all on helping people into work and independence, or do we want a system that grows ever larger, more expensive and more detached from the principle that work should always pay? The British people instinctively understand that balance. My noble friend Lady Stedman-Scott pointed out the statistics and polling. They are compassionate, but fair. They believe in helping those who genuinely need support, but also that those who can work should do so and that the system should never place the greatest burden on those already doing the right thing. For that reason, and in the interests of fairness, sustainability and the long-term health of our welfare state, I cannot support the Bill and I firmly believe that the cap should be reintroduced as soon as possible.