Sir Keir Starmer’s government dug in as it faced a Labour revolt over the two-child benefit limit.
A Labour MP is ready to table an amendment to the King’s Speech to axe the restriction. But Treasury minister James Murray gave no indication that the Government was ready to agree to the move so soon after getting elected.
He stressed the new Government would not be making “unfunded spending commitments”. However, Sir Keir was facing a Commons showdown over the policy which is opposed by many Labour MPs.
The row could be a major test of his leadership early in his premiership.
Liverpool Riverside Labour MP Kim Johnson has slammed the two-child benefit cap as “cruel, punitive and pushing struggling families into further poverty”.
She tweeted: “I am laying an amendment to the King’s Speech calling for the cap to scrapped - immediately lifting 250,000 children out of poverty.”
I have long campaigned against the two-child benefit cap.
— Kim Johnson (@KimJohnsonMP) July 10, 2024
This policy is cruel, punitive and is pushing struggling families into further poverty.
I am laying an amendment to the King's Speech calling for the cap to scrapped- immediately lifting 250,000 children out of poverty. https://t.co/2IpuTUaJ24
Mr Murray, a former deputy mayor for housing in London, was grilled on the issue as he did the morning media round for the Government.
Ealing North MP Mr Murray told Times Radio: “The fact that child poverty is so high in this country is appalling.
“We want to set out a comprehensive strategy to reduce child poverty.
“The last Labour government made huge progress on tackling child poverty.
“We are going to do that again now that we are in government.”
But on the two child benefit limit, he added: “On this specific issue, obviously there are tough decisions to be taken.
“But we are never going to be making unfunded spending commitments because we know that that way lies economic chaos which hurts the poorest the most.”
Liberal Democrat MPs have also backed scrapping the cap.
John McDonnell, Labour MP for Hayes and Harlington, said last week that he is ready to table an amendment to the Finance Bill, which would be debated in Parliament after the Budget in the autumn, to ditch this benefit limit.
But a crunch vote could now come much sooner during a debate over the King’s Speech which is set to be delivered on Wednesday.
The cap, introduced by the Conservatives in 2017, prevents parents claiming Universal Credit or child tax credits for a third child, except in very limited circumstances.
Figures published recently by the Department for Work and Pensions showed there were 1.6 million children living in households affected by the cap as of April this year, up from 1.5 million to April 2023.
Of these, 52 per cent of children were in households with three children, 29 per cent in households with four children, and 19 per cent in households with five or more children.
The Resolution Foundation has said that abolishing the two-child limit would cost the Government somewhere between £2.5 billion and £3.6 billion in 2024/25, but that such costs are “low compared to the harm that the policy causes”.
