Scotland to scrap two-child benefit cap

The Scottish government has announced it plans to scrap the two-child benefit cap – a move that will lift 15,000 children out of poverty.

Let’s take a look at the plans and what this could mean on a UK-wide scale.

What is the two-child cap?

The two-child cap means UK households can only claim universal credit and child tax credits for up to two children.

It’s been in place since 2017, when it was introduced by Theresa May’s Tory government.

Labour have been under pressure to axe the policy since taking power in July.

But they decided to keep it, saying they had an “ambitious strategy” to reduce child poverty.

One in three children live in poverty

Over 30% of children live in poverty in the UK – the equivalent of nine children in every classroom.

And official figures show 1.6 million children are being affected by this limit.

That’s why, along with many organisations, MPs and charities, we’ve been calling for an end to the two-child limit.

What are Scotland’s plans?

The landmark move will see the Scottish government offset the cap by providing funding to affected families by 2026.

According to the BBC, the move could cost between £110m and £150m.

Because the two-child cap is a UK-wide policy, it will take some time to implement.

We don’t know yet exactly how Scotland plans to offset the cap, i.e. by making payments to those affected or inviting families to apply for extra cash.

‘Crystal clear’

Scotland’s finance secretary Shona Robison said that many have waited for the UK Labour government to scrap the cap.

Robison said Keir Starmer’s government will need to work with the Scottish government to bring in the changes, adding: “Let me be crystal clear, this government is to end the two-child cap and in doing so will lift over 15,000 Scottish children out of poverty.”

Is the rest of the UK next?

The plans have been welcomed by campaigners, though some are concerned the support won’t be available until 2026.

Many are now putting pressure on the UK government to follow in Scotland’s footsteps.

The End Child Poverty Coalition described the news as “amazing” for Scottish families while the Joseph Rowntree Foundation said it showed “positive signs of investing in the right things”.

Both have renewed their calls for Starmer to scrap the cap.

Do you need money help?

If you’re struggling to make ends meet because of the two-child benefit cap, it might be time to ask for support.

We can help you get back on track by:

• creating a realistic budget
• checking you’re getting all the benefits you’re entitled to
• talking you through some debt solutions that might be suitable for you (some are free and others have a fee)

We give free and impartial advice online or you can give us a ring.

There’s lots of useful information on our website too.