Working Tax Credit and Universal Credit: Two-Child Limit — [Steve McCabe in the Chair]

Backbench Business – in Westminster Hall at 1:30 pm on 21st April 2022.

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Photo of Steve McCabe Steve McCabe Labour, Birmingham, Selly Oak 1:30 pm, 21st April 2022

Despite what might be happening elsewhere, we have a very important debate here. I call Alison Thewliss to move the motion.

Photo of Alison Thewliss Alison Thewliss Shadow SNP Spokesperson (Treasury)

I beg to move,

That this House
has considered the two child limit of working tax credits and universal credit.

It is a pleasure to see you in the Chair, Mr McCabe. You are quite right to point out that, while other debates might be happening, this debate is actually quite important. It has been six years, nine months and 13 days since the Budget in 2015, when the two-child limit appeared in the Red Book, and just over five years since it came into force. Some might be wondering why I am bothering to come here today to complain about this policy; it is because, for me, it is a fundamental injustice and deserves to be looked at seriously.

The Child Poverty Action Group and the Church of England estimate that 1.4 million children in 400,000 families are now affected by the two-child-limit policy. Unless it is abolished, the number of children affected will reach 3 million, as more children are born under the rules.

The two-child limit for child tax credits and universal credits broke the long-standing link between need and entitlement, on the basis that families in receipt of state support ought to face the same choices as those supporting themselves solely through work. This is a false narrative; it is the myth of the benefit queen. This policy has never been about fairness.

The majority of families affected by the policy are in work—low-paid jobs, working to support their families. In mentioning that fact, I do not seek to stigmatise those not able to work—many have caring responsibilities, disabilities or other reasons that prevent them from working. They ought to have the protection of the social security system, too.

In many cases, it is all but impossible for those who are working to take on more hours to make up the drop in income created by the two-child limit. The Work and Pensions Committee pointed out that the cost of childcare can also mean that families will not be able to make up the loss by working more hours. The two-child limit is a poverty trap.

Many people are just not aware of the policy, which is a significant issue. They do not know that it will apply to them. The Government intended to influence people’s choices to have children, but they have certainly not been influenced in any meaningful way by a piece of Department for Work and Pensions legislation.

The latest research by Mary Reader, Jonathan Portes and Ruth Patrick on whether cutting child benefits reduces fertility in larger families establishes that the two-child limit is not leading to any major reductions in fertility among those likely to claim benefits. All the policy does is punish people for their circumstances and drive up child poverty rates.

Photo of Imran Hussain Imran Hussain Shadow Minister (Future of Work)

I thank the hon. Member for bringing a very important debate to this Chamber. The reality is that this Government’s ideological, intentional austerity agenda, more than a decade long, has led to the biggest cost of living crisis in our generation and rampant poverty on our streets. Does the hon. Member agree that it is policies such as this that lead to children going hungry in our constituencies, and that is why it needs to be scrapped immediately?

Photo of Alison Thewliss Alison Thewliss Shadow SNP Spokesperson (Treasury)

I absolutely agree. That poverty is deep and enduring, and prevents those children from reaching their full potential. We cannot forget the choices that many families are having to make because they just do not have enough money coming in.

No one can predict the course of their lives, certainly not the course of their children’s lives, and nobody can plan for absolutely every eventuality—it is just not the reality of life. CPAG estimates that, during the pandemic, an additional 15,000 families, who never envisaged losing their jobs and incomes in a global health crisis, were affected by the two-child limit, as they claimed universal credit for the first time. That includes people who worked in sectors that shut down and have yet to recover, people who tragically lost their partners to covid and people who still suffer the effects of long covid. Domestic abuse rates increased during the pandemic, which resulted in some families separating for good. In each of those scenarios, families with more than two children were not afforded the dignity of the support they required, because the Conservatives made a judgment back in 2015 about the appropriate size of a family for benefit claimants.

Photo of Fleur Anderson Fleur Anderson Shadow Minister (Cabinet Office)

I congratulate the hon. Member on securing this debate, which I agree is very important. In Putney, Roehampton and Southfields, families are having to go to food banks more often. I have spoken to Wandsworth Foodbank and Little Village, which helps local families, and they have said that the thing that would make the most difference in stopping poverty in my area is scrapping the two-child benefit cap. Does she agree that the Minister should look into this, assess the impact and scrap it as soon as possible?

Photo of Alison Thewliss Alison Thewliss Shadow SNP Spokesperson (Treasury)

I absolutely agree with the hon. Member, and she makes a good point about food banks. Essentially, the Government are saying that they will pay to feed and clothe only two children, and not provide for the rest of those families. Either that money gets very stretched or families cannot stretch any further and they end up going to food banks. In a country as wealthy as this one, families should not have to go to food banks just to put food on the table for their children.

I bring the debate today to highlight the enduring flaws in this UK Tory Government’s two-child limit and to ask them to end it before things get even worse for families struggling today.

Photo of Margaret Ferrier Margaret Ferrier Independent, Rutherglen and Hamilton West

An exception to the two-child limit is where the child was conceived in non-consensual circumstances, but to be eligible for this exception the parent must be able to point to either a conviction or a criminal injuries compensation claim. Does the hon. Member agree that as rape conviction rates are so low, because the bar for evidence is so high, this requirement further victimises claimants?

Photo of Alison Thewliss Alison Thewliss Shadow SNP Spokesperson (Treasury)

That is absolutely correct. I will go on to talk about some of the exemptions to the policy and how ludicrous they are, but for a crime such as rape to have some place within Government policy on benefits is quite abhorrent.

The first difficulty with this policy is that it gives an arbitrary cut-off date, resulting in two classes of families: those with children born prior to 6 April 2017 and those with children born after that. For the arbitrary quirk of fate of bringing a baby into this world a minute after midnight, a family will find itself £2,935 worse off per year. I give some credit to the former Secretary of State, Amber Rudd, for not making the policy retrospective, as was originally intended. However, having recognised the inherent unfairness of the policy, she ought to have abolished it altogether.

Photo of Rupa Huq Rupa Huq Labour, Ealing Central and Acton

The hon. Member is making a powerful speech, and she talked about changes before and after this policy was introduced. Has she seen the figure that since covid started, 27% more families now fall under the two-child-limit policy? Does she agree with the Bishop of Manchester, who said last year that the policy “defies moral justification”? When it was first introduced, 60 bishops, as well as Muslim and Jewish leaders, wrote a joint letter to The Times saying:

“Children are a private joy and a public good. They are all equally deserving of subsistence support.”

Photo of Alison Thewliss Alison Thewliss Shadow SNP Spokesperson (Treasury)

I absolutely agree with the hon. Member on that point and with those religious leaders who wrote that letter then and who continue to campaign on the issue now. I will touch on some of that a little later.

The effect of the two-tier policy that has been created is that a family with three children, the youngest being six, will receive support. However, a family with three children, the youngest being four, will not. The needs of these families are exactly the same, but this Government have decided that they are not entitled to the same support. Previous research on the issue has found that in some cases older siblings can come to resent the new baby in the family, because they have lost out on their activities, their sports clubs and the things they used to do because the family no longer has the money to get by. It is desperately unfair that children are already losing out on wider life experiences because of this discriminatory policy, as well as now on the very basics because of the cost of living crisis.

I will describe some of the other inconsistencies in the policy in some detail, because every time I explain them to people they are absolutely baffled; I would like to hear the Minister’s answer to the mad exemptions that exist. On the exemption policy for multiple births, if someone happens to have twins after having a single birth, there is an exemption to the policy, which is fine. If they have twins first and then go on to have another baby, they are not entitled to support, presumably because they should have known better. There are three children in each scenario, but different support.

As my hon. Friend Margaret Ferrier mentioned, the rape clause is even more pernicious. For this exemption, a woman has to fill in a form and have her traumatic experience verified by an official to say that her third child was conceived through rape or a coercive relationship. This form exists and has to be signed off by a professional to verify that someone has had a child in that circumstance. However, it can be claimed only if the person is not living with the parent of that child.

We know that forcing a woman to leave a relationship can put her and her children in danger, but that reality does not appear to trouble the Department for Work and Pensions. Some 1,330 women claimed under the exemption in 2021. The really perverse part of this pernicious and stigmatising policy is that it applies only to third and subsequent children. If someone’s first child was conceived as the result of rape and they went on to have two more children, that is just unlucky for them as far as the DWP is concerned.

The exemptions around adoption are also perverse. There is no additional support for an adopted child if they are adopted from abroad, or if a person and their partner were that child’s parent or step-parent immediately before they adopted them. Why on earth would this Government want to disincentivise adoption? The exemption for kinship carers, who were losing out on support for their own children because they had been so good as to care for others, was only granted after the Government were taken to court. It should not take legal action for this Government to recognise and fix their mistakes, but we know the DWP repeats this pattern again and again.

The effect of this policy is well documented and well assessed, and I pay tribute to the Child Poverty Action Group, the Church of England and other faith groups including the Interlink Foundation, which represents the orthodox Jewish community. As my hon. Friend mentioned, there is a discrimination at the heart of this policy that affects people of faith. It sticks in my craw to see Easter greetings from Members of this place—the Holy Willies of this place—when their faith does not extend to supporting children, who they are instead actively pushing into poverty through the policies they advocate. How does the Minister believe this policy affects people of differing backgrounds and faiths, and how can he say the policy is fair in this context?

Photo of Jim Shannon Jim Shannon Shadow DUP Spokesperson (Human Rights), Shadow DUP Spokesperson (Health)

I am normally pleased to hear the hon. Lady speak on any issue, but particularly so on this issue, given her knowledge and expertise. On her point about faith, does the hon. Lady feel that a human rights issue could well be at stake here? While that is not a direct responsibility of the Minister, it is a part of this debate that must be considered. By enforcing this rule, the Government are creating a human rights issue for people who do not want to be under that law.

Photo of Alison Thewliss Alison Thewliss Shadow SNP Spokesperson (Treasury)

The hon. Gentleman is absolutely correct to point that out. There are particular issues with this policy for women in Northern Ireland, related to the rape clause and issues of abortion. When this policy was brought in and was being implemented, Northern Ireland particularly was an afterthought to this Government, just as faith groups have been. Children are regarded as a blessing—not just by people of faith, but particularly by them. Therefore, the policy of this Government to limit support to the first two children in a family has a disproportionate effect on people of orthodox Jewish, Muslim or Catholic faith, for whom abortion and contraception just are not options. We already know that this policy is forcing some of those families into significant poverty.

We all know that contraception is not infallible, even for those who actively choose it. In one of its reports, CPAG has quoted a parent who said:

“I got pregnant despite having an implant. When I found out it was too late for [an] abortion. I’m struggling since then as I had to give up my work”.

I very much support a woman’s right to choose, but a Government welfare policy should not be forcing people into abortions. The British Pregnancy Advisory Service has carried out its own research on this issue and found that it was a factor in the decision making of women who were aware of the policy. BPAS has said:

“We have warned the government that the two-child limit is forcing some women to end what would otherwise be wanted pregnancies. Since 2016, the number of abortions performed to women with two or more existing children has risen by 24%, compared with an increase of 11% performed to women with one existing child.”

I would like the Minister to comment specifically on how he is monitoring the impact of this policy on women’s decisions, and why he considers this to be an appropriate part of social security policy.

We are in a cost of living crisis, and the impact of that crisis on larger families is particularly acute. Energy and food prices are soaring, and this Government did little in the spring statement to hand out a lifeline to people who are struggling right now. Can the Minister outline what, five years in, is the ongoing monitoring of this policy? What consideration has been given to removing it altogether? What conversations has he had with the Chancellor about this policy? When the modelling of its impact on child poverty is so clear—I almost wish we were in one of those American Senate hearings where I could show the graph, because it is absolutely crystal clear—why are this Government, dystopian as they are, continuing to pursue a policy that they know has failed in its objectives? It is simply causing more hardship in every passing year. Almost half of all children living in families with more than two children are in poverty, and the Government must know that. I want to know why they refuse to act.

The Scottish Government have done their best to support families with the Scottish child payment, which we brought in and are increasing, and on which there is no two-child limit, under the social security powers we have. With 85% of social security powers still held in this place, the UK Government bear a responsibility to do what they can. In the face of the UK Government cutting giant holes in the safety net, tackling poverty and making Scotland the best place in the world to grow up in is a challenge. Our devolved powers go only so far. We need all the powers of a normal nation to ensure that we can support all our people and value every child, and not just the first two.

Photo of Beth Winter Beth Winter Labour, Cynon Valley 1:46 pm, 21st April 2022

I very much welcome the time allocated to this debate today. It is vital we have this discussion, because the two-child-limit policy is yet another legacy of the low-pay, low-income experience that is the stamp of the Conservative Government. We have already discussed in recent weeks in this building the impact of the real-terms cuts in social security benefits and the minimum wage, and what we all anticipate will be a real-terms public sector pay cut. The debate today has reflected on the first of those: the appalling offer of a 3% increase in social security while inflation is increasing at 7% and could well go up to 10%. That is a real-terms cut in people’s incomes. How people will survive I have no idea.

Some households do not even receive a 3% rise because, under the two-child limit, parents are not entitled to any extra support through universal credit or child tax credit to help with raising a third or subsequent child born after 6 April 2017.

Photo of Margaret Ferrier Margaret Ferrier Independent, Rutherglen and Hamilton West

Does the hon. Lady agree that following the Government’s decision to cut universal credit payments, with inflation rates rising astronomically and a real cost of living crisis, a decision to keep the two-child limit is actively pushing children below the poverty line, which will undoubtedly impact on the UK’s levels of social mobility?

Photo of Beth Winter Beth Winter Labour, Cynon Valley

I totally agree. Action needs to be taken on all those policies, including reinstating the £20 universal credit uplift and extending it to those on legacy benefits. We need a whole raft of policies to prevent, reduce and tackle the extreme levels of child poverty that currently exist in this country.

I refer briefly to the Child Poverty Action Group and Church of England report commissioned for the fifth anniversary of the two-child-limit policy. It is very clear in saying that the two-child limit breaks the historic link between need and entitlement. The benefit should be an entitlement, but that link, which was the founding principle of our social security system, has been broken. The report is clear that our social security system should support families and give children the best start in life, regardless of how many siblings they have. They are our future and we should invest in our future generations. The report concluded that the Government must remove the two-child limit to allow all children to thrive.

April’s below-inflation benefits rise means that affected families with three children face a further £938 a year shortfall in benefits to cover the basic costs of raising them, on top of the pre-existing £6,205 shortfall from 2021, with larger families facing an even bigger hole in their income. That is absolutely appalling and devastating for millions of families throughout the UK.

The two-child limit restricts child allowances in universal credit and tax credits worth £2,953 per year to the first two children in a family unless the children were born before 6 April 2017, when the policy came into force. As Alison Thewliss has already outlined, the disparities, inconsistencies and discriminatory practices in terms of who is and is not entitled are completely unfair.

Unless this two-child limit is abolished, the number of children affected will reach 3 million, as more are born under the policy. We currently have 4.3 million children across the UK living in relative poverty. That equates to around nine in every 30 children in a UK classroom.

As the two-child limit is the biggest driver of this rising level of child poverty, CPAG has estimated that it will push another 300,000 children into poverty, and 1 million more into deeper poverty, by 2023-24. By 2026-27, over 50% of children in families with more than two children will be living in poverty—half of the population in poverty.

We already knew in 2019, from the Work and Pensions Select Committee report on the two-child limit, of concerns that it breached not only the Government’s wider responsibility and international commitments to equality but human rights, including the European convention on human rights and the United Nations convention on the rights of the child. Breaching such human rights commitments appears to come easily to this Government, however; we only need to look at the United Nations High Commissioner for Refugees’ comments on yesterday’s Nationality and Borders Bill for another example of that.

One of the core authors of the Child Poverty Action Group report, Dr Ruth Patrick, says:

“the two-child limit is a poverty-producing policy and one which should be removed”,

but what about the voices of the parents who have contributed to those pieces of research? I will quote just one, who says:

“We wear extra layers of clothes as I cannot afford to put the heating on. We shower on a Wednesday and Saturday to reduce energy bills but we shouldn’t have to live like this.”

Nobody should have to live like that, and I am sure the Minister would agree on that point.

As in Scotland, the Welsh Government have tried to take action to counter some of the worst aspects of this policy, the cost of living crisis, and child poverty in Wales, for example through the commitment to extend free school meals to all primary school pupils from September 2022. However, unfortunately, the main problems causing child poverty lie here in Westminster. The Welsh Affairs Committee, on which I sit, recently looked at the benefits system in Wales.

Photo of Jonathan Edwards Jonathan Edwards Independent, Carmarthen East and Dinefwr

I congratulate the hon. Lady on making a very powerful case during her speech. However, ultimately, has she come to the position that I have, in my political life, that a just and fair economy and society for Wales will never be created by Westminster? The only solution for us is to take control of those powers ourselves. As the hon. Lady outlined in her speech, where we have those levers, we are making a positive difference, but ultimately, we need all of those levers. Surely, that should be the normal position for her to take now.

Photo of Beth Winter Beth Winter Labour, Cynon Valley

I was just coming on to that. The Welsh Affairs Committee quite strongly recommended that we should be exploring the possibilities of devolving the administration—at the very least—of social security and benefits to Wales. We are still awaiting the Minister’s response to the report.

The Committee also recommended an urgent review on ending the £20 universal credit uplift, and on the five-week wait for universal credit, the benefit cap, the bedroom tax, and—crucially, for the purposes of this debate—the two-child limit. We would be very interested to hear the Government’s response to that report.

This policy is having a devastating impact on a large number of my constituents in Cynon Valley, where wages and household incomes are already well below the UK and Welsh averages. The two-child limit therefore has an even deeper impact on my neighbourhood. I recently commissioned some research from the Bevan Foundation on the economy in my constituency. There were some alarming findings on people’s incomes and the levels of benefit-dependent families. They are being impacted drastically by this pernicious policy, and we all know that it will get worse—and already has—with the cost of living crisis, which is having a devastating impact on so many people.

A fortnight ago, I launched in my constituency a survey on the cost of living crisis. Within 48 hours, I had received in excess of 400 responses. I am in the process of collating and analysing those responses to produce a report, but at first glance, the stories coming through from local people are absolutely harrowing—the way people have to live, not having food on the table for their children, not having the heating on. It is absolutely appalling and needs to be addressed urgently. A lot of those people are affected by the two-child limit. I will share that report with the Minister when it is completed—within the next month, I hope.

I very much look forward to the Minister’s response outlining why the Government remain determined to pursue their low-pay, low-income agenda, despite the misery that it imposes on millions of people and their children across the country. Diolch yn fawr.

Photo of Hywel Williams Hywel Williams Shadow PC Spokesperson (International Development), Shadow PC Spokesperson (Work and Pensions), Shadow PC Spokesperson (Defence), Shadow PC Spokesperson (Cabinet Office), Shadow PC Spokesperson (International Trade), Shadow PC Spokesperson (Foreign Affairs), Shadow PC Chief Whip 1:56 pm, 21st April 2022

I am very glad to follow my friend, Beth Winter, and Alison Thewliss.

Ahead of the debate, I asked people what they thought of the two-child limit, and the responses were interesting, revealing and quite varied. People thought that it had been a short-term measure; that it had been withdrawn; that it had had little effect; and, most revealingly, some said, “I had just forgotten about it.” The point is that it had become supposedly normal; it had disappeared from public debates.

The two-child rule has indeed disappeared as a matter of public concern. It has become the unquestioned common sense of the system, but it remains an excruciating burden on families, particularly innocent children, who are subject to its evil effects and sometimes suffer as a consequence of the voluntary or involuntary actions of parents driven by religious or social beliefs on polygamy, contraception or abortion, for example; as a consequence of contraceptive failure or accidents; more sinisterly, as a consequence of patriarchal attitudes and oppression; or, even worse, as a consequence of the rules around rape, as we have heard.

I congratulate the hon. Member for Glasgow Central on securing the debate and for shining a light on a cruel and oppressive measure, bringing it into the light, if not the comfort, of truth’s flame—as the poet R. S. Thomas said in another case. I join her, the hon. Member for Cynon Valley and others in calling for the two-child rule to be withdrawn forthwith.

I hope hon. Members will forgive me, but this matter has a particular resonance for me as one of seven children, one of whom died in infancy. We were brought up in a council house—a very good council house built to high post-war standards—and we were fortunate in many ways, three of which I will refer to. First, my parents were extremely hardworking at a time of full employment, so we lacked for nothing. Secondly, we lived at a time of consensus on wide-ranging social provisions, so we had the health service, vitamins, glasses, free school milk and all the rest of it. We all went on to further and higher education, initial and higher degrees, professional qualifications, and professional careers, all of which was grant aided.

The third point about my family is that we were not subject to the two-child limit. Otherwise, I would scarcely be standing here today. There is always a danger of idealising the past in comparison with the wretched present. In Welsh, we say, “Teg edrych tuag adra”—it is a fine thing to look back at one’s home—meaning to look at the past with rose-tinted glasses.

The evidence shows a change in the provision, and it is very much a change for the worse. The two-child limit is a particularly bad case. The real point of my speech is that there has been a change in attitudes since 1979, I suppose—I referred to school milk a moment ago, and I do not have to emphasise the significance of that debate. There has been a change in the accepted common sense that we all owe a duty to each other—that a provision for one is a provision for all. That is, with very few exceptions, a common provision. The exceptions in earlier times would have been made on the basis of the violation of legal requirements, social and religious norms or on the judgment of moral turpitude. That was the accepted common sense, and there has been a change.

I will digress for a moment to mention part of my earlier career. Years ago I was a mental health social worker and would visit the psychiatric hospital at Denbigh, which served all of north Wales. In the back ward of that mental hospital there lived a dozen or so older women, mainly in their late 70s. They had been there since the 1930s; they were totally institutionalised and unable to leave. They were initially detained on the basis of “moral imbecility”; that is why they were locked up. They had had illegitimate children. Supposedly we do not make those sorts of moral judgments these days. However, I have to say that some of the arguments for the two-child rule—which will be familiar to many of us and I will not rehearse—have that flavour of moral condemnation. Those arguments are based supposedly on the common sense that they—that is, the generalised other—should take responsibility for the exceptions that prove the rule here. Well, those exceptions are surely irrelevant, and hence, so are the children who suffer—they are irrelevant as well.

I could make many further points about this general argument and I could talk about the practicalities. As we have already heard, Wales has the highest rates of child poverty of any part of the UK, at 31%. In 2021 14,800 households were affected by the two-child limit; 570 of those households were in Gwynedd, the county where my constituency is located. The Welsh Affairs Committee has published its report on the benefits system in Wales, which raised concerns about the two-child limit. It said that devolving powers to Wales—equivalent to those in Scotland—would mean that we could take real measures to tackle child poverty, such as the additional child payments for low-income families introduced in Scotland. I concede that that affects only a small part of the social security system, but it is much better than the situation that we face in Wales.

I could refer to the rationale behind the policy of ensuring that families receiving means-tested benefits should face the same financial choices about having children as those supporting themselves through work. However, we know that the majority of claimants—that is 56%—are actually employed. The arguments around people working or not, and having lots of children, are entirely bogus to my mind. My request to the Minister today is fairly simple. I ask him to signal a desire to move away from the supposed common sense of this policy and from the rationale that underpins it—the cruel rationale of less eligibility.

Photo of Jim Shannon Jim Shannon Shadow DUP Spokesperson (Human Rights), Shadow DUP Spokesperson (Health) 2:03 pm, 21st April 2022

It is always a pleasure to speak in Westminster Hall, but it is a special pleasure to follow Alison Thewliss. The hon. Lady and I have many things in common—apart from the independence of Scotland, of course. However, when it comes to social issues we are on the same page on just about everything; I can comfortably support her on those issues. I thank her for setting the scene, and I thank all other Members who have contributed.

I love accents. I love the accent of Beth Winter. I hope I have pronounced that correctly—I probably have not. I think the Welsh accent adds to this Chamber; there are a number of Welsh Members who, through their voice and accent, add to the Chamber. I hope that my Ulster Scots accent from Northern Ireland also adds in some way to the Chamber, bringing the cultural values of all four nations together. It is always a pleasure to do that.

I fully support the comments of the hon. Member for Glasgow Central, and indeed those of everyone who has spoken and will speak afterwards. Hopefully, the Minister will give us some succour and support. Opposition Members’ comments are clear, and we look to the Minister in hope of a response. I am going to take a slightly different angle. I think the hon. Lady probably knows this, because she is always well versed in the subject matter, but the London School of Economics has been very clear. Its research set out to explore how the policy, in operation since April 2017, has affected fertility of third and subsequent births, and it said:

“Using quantitative methods, we find the policy led to only a small decline in fertility among those households directly affected. This implies that the main impact of the policy has been to reduce incomes”— this hits on the issue that the hon. Lady referred to—

“among larger families who are already living on a low income”.

There are therefore two issues to this debate. It continued:

“and hence to increase child poverty.”

Those are the things that this debate and my short contribution will address. That is why I am very much opposed to the two-child policy and its effect on tax credits and universal credit.

Photo of Margaret Ferrier Margaret Ferrier Independent, Rutherglen and Hamilton West

Research from the New Field Foundation found that the limit does not discourage families from having more children, and has only worsened their financial difficulties. Does the hon. Gentleman agree that Ministers must actively engage with charities and organisations with expertise in policy impact to understand the real-terms impact of such policies?

Photo of Jim Shannon Jim Shannon Shadow DUP Spokesperson (Human Rights), Shadow DUP Spokesperson (Health)

I wholeheartedly support the hon. Lady’s comments.

I am going to say something fairly harsh. I am not a harsh person, or I try not to be, but I always had a fear about the two-child limit—perhaps others agree with me—which is why I opposed what I dubbed at that time the “Chinese limit”. We do not have an authoritarian state just yet, but in China they have—I know they are going to change the two-child rule, or at least they are hoping to change it—and in a way that is the authoritarianism of this DWP directive, which inadvertently or directly has put in place the Chinese limit.

I was talking to the hon. Lady before the debate, and I said that if there had been a two-child limit when our parents were born, I would not be here because my mother would not be here; she was the fourth child out of five. The hon. Lady and others—perhaps even the Minister—would not be here either. If the two-child limit were enforced here with the regularity that it is in China, but with an income base that makes it almost authoritarian, there would be children who are not born—people who would not be here. I want to highlight that dark perspective, because that is where I see this draconian, dictatorial and very authoritarian directive from the DWP going.

Photo of Carol Monaghan Carol Monaghan Shadow SNP Spokesperson (Armed Forces and Veterans), Shadow SNP Spokesperson (Education)

The hon. Gentleman mentions China, and he knows that it is having huge problems now because there is an expectation of low numbers of children. It is having difficulties with its birth rate. It is interesting that since 2012—since austerity kicked in—the birth rate in the UK has dropped by 12%. That is significant, and it has huge implications for pension contributions and for many jobs.

Photo of Jim Shannon Jim Shannon Shadow DUP Spokesperson (Human Rights), Shadow DUP Spokesperson (Health)

I thank the hon. Lady for that intervention. It is about not just the two-child limit on its own, which means that a person cannot have a third child because there will not be the same structures in place to help them. It is also about issues such as the impact on income and pensions. She is absolutely right. The Minister in his place is the man who is placed to answer all these questions. I hope he will give us his thoughts on how this situation can be corrected. I go back to my point of a few moments ago about the Chinese Government. The policy does not simply impact the third child—it impacts every child in that home.

I have three sons. The first two each have two children and made a decision themselves not to have a third one. The third boy has one child and another one on the way. That is not because China’s limits are impacting upon the Shannon family, because they are not—it is a decision made by families themselves. If a family was to have a third child, why should they not be allowed to? Why should we not look at the issue of income of all the other families, and maybe say to those who said that the policy would cause there to be fewer births and cause people to use birth control, that that is proving not to be the case? We are simply taking money from households.

I referred to the fertility aspect of the two-child limit in the research summary, and want to quote further from the research:

“This raises the question of whether the two-child limit reduced the overall fertility of third and subsequent births in the UK. Survey evidence from the British Pregnancy Advisory Service found that 57 percent of women who were likely to be affected by the two-child limit said it was a relevant factor in their decision to have an abortion”.

I know some may not agree with me—I know others who do—but I am very clear in my mind. We have a duty. That is how I have always voted in this House, though others may have a different opinion. I believe in the sanctity of life—the life of the mother and the life of the child—and this policy has done something that I think is morally wrong. I think it is wrong that people should have an abortion because they cannot afford to keep the child that they carry. It is as simple as that. I very much disagree with the policy.

The researchers say that the 57% is a random sample, but also that it is bigger than that. They took it a wee stage further on income and divided

“adult women of childbearing age into those who are on benefits (or are likely, given their socio-economic status, to be on benefits) or not;
and those who already have two or more children or not.”

The stats provide an evidential base for the Minister; I am happy to make them available to him, if he thinks they would be helpful. I think they would be, including for civil servants, when it comes to looking at the bigger picture.

Data published in April 2021 shows that 1.1 million children were affected by the two-child limit—237,000 more than the previous year. Updates for 2022 are not yet available. The number of children affected will continue to grow as nearly all low-income families with three or more children eventually become subject to the limit. What we are doing—I say “we”, but it is not the people here; it is the Government—is imposing an income limit on those who already have three children or more.

I have already discussed in this place on several occasions the need for the child benefit limit, set in 2013, to be uplifted, because working families are affected. Someone who earned, for example, £49,000 in 2013 was on a good wage that would allow their partner to work part-time hours to take care of their children. They are in a completely different scenario today, with energy costs. The hon. Member for Cynon Valley spoke at some length about energy costs and the impact on income. It is no different in Cynon Valley from Strangford or Glasgow Central, or anywhere else.

With gas, electric and fuel at treble the price of 2013, now more than ever we need to do the right thing by families—review, change and abolish this rule. We need to give some decency, compassion and understanding back to families, who are under incredible pressure. A review of the policy and then its abolition are essential.

The data also suggests that the probability of having a third or subsequent child declined by some 5% after the reform, which suggests that the two-child limit has led to a decline in the number of third and subsequent births of approximately 1%. The evidential base is there. This measure has a success rate of only 1%, while children in our homes are suffering. If it has only achieved a change of 1%, why pursue it? Some might say that if a party wins an election by 51% to 49% they have still won it, but as I understand it, the whole idea behind this policy was to focus on saving money. The savings are not there, so it comes down to the critical question of what this policy is really all about. Five years on from its implementation, research has found that the policy has a very marginal impact on families having more than two children but has deprived low-income families of approximately £3,000 per year—the hon. Member for Cynon Valley referred to that at some length, and Hywel Williams spoke about it as well. They both did surveys in their constituencies, so they have done their homework. They have got the evidential base; they have got the proof.

I am conscious of time, so I will conclude with this: given the pressure that families are under, we in this place must take appropriate steps to alleviate that pressure. The Minister is an honourable man and is always incredibly friendly; it is his nature, and he does take on board the issues that we bring to his attention. However, today we are not just looking for the decent side of the Minister—which we will always get—but for concrete evidence that some of the changes that we on the Opposition side of the Chamber seek, which we feel are important, will be made. I can foresee a time when working families will be unable to make ends meet, and we in this place have a duty to the vulnerable and to the children who are suffering as a result of policies that do not reflect the issues that people have but are outdated and based on wrong assumptions. In my opinion, that 1% figure means that a wrong assumption has been made, so it must change. The time is right to make those changes, so again I look to the Minister, not just for reassurances but for a change in the law.

Photo of Alan Brown Alan Brown Shadow SNP Spokesperson (Energy and Climate Change) 2:17 pm, 21st April 2022

It is a pleasure to serve under your chairmanship, Mr McCabe, and I commend my hon. Friend Alison Thewliss for having secured this debate. More importantly, I thank her for the tireless campaigning she has done on this two-child policy, which victimises and stigmatises families and children. It is worth putting on the record that my hon. Friend was the first Member to identify the pernicious rape clause, on Budget day in July 2015, and her speech shows just how much she has immersed herself in highlighting the unfairness of this policy and the ludicrous exemptions that go with it. As she has said, it is a poverty trap. The fact that children born beyond the midnight deadline are not deemed worthy of support, and that we now have two tiers of families—two families might be the same size, but by virtue of when one child was born, one family gets more support than the other—is absurd.

I also pay tribute to all other hon. Members who have contributed or made interventions. As Beth Winter said, this is about the need to support all children and ensure basic fairness; why do this UK Tory Government find it all too easy to breach human rights? Hywel Williams made a powerful speech, talking about his own circumstances and how political attitudes have changed. The example he gave about the moral condemnation in the past of people stuck in mental institutions, and how we are returning to moral judgments of people having children, should make the Minister sit up, because it certainly made me sit up.

Then, of course, we had a fantastic contribution from Jim Shannon. It did start with his “better together” comparison, but apart from that, I agreed with every word he said. When the hon. Member for Strangford uses such strong language and condemns a policy so much—I genuinely think that was the best speech I have heard from the hon. Gentleman; that says a lot, but it was a really powerful speech—if the Minister does not take note, something is far wrong. The hon. Gentleman gave the example of the Chinese limit, and how it would have impacted families and people here had such a policy been implemented, but he also spoke about the dark perspective of this policy. It is morally wrong, and not just that: it has been an abject failure in its aims. That really summed it up, so I pay tribute to the hon. Gentleman for his speech.

It is disappointing that there are no Tory Back Benchers here to back up the policy. Maybe that says how bad the policy is, or maybe they are just choosing to back the corrupt Prime Minister in the “other place.” The point is that agreeing to provide welfare support for only two children is a horrible policy, backed up by dog-whistle politics. The concept clearly was that people should be able to afford children, just like those who rely solely on work for their income and therefore do not need additional welfare support. That is language designed to imply that anyone on benefits is a scrounger, and that people have children just to screw the welfare system. It is truly awful, and it actually puts a price on children.

As we have heard, in affected families, who suffers the most? The children. Hungry kids cannot learn in school. They will be disadvantaged and less likely to have a positive outcome, so whatever circle the Tories think they are breaking, they might be condemning more people to underachieve and have a higher chance of unemployment, and to be less likely to participate in higher and further education and more likely to end up in lower-paid, semi-skilled work. As the hon. Member for Strangford said, if some children suffer, others do. It is not just the ones directly affected.

Worst of all, the entire concept is based on politics and prejudice and not evidence. What we now have, clear as day, is evidence of how the policy works for those affected by the two-child policy. The Library briefing confirmed that of the 317,500 families affected in April 2021, 56% had somebody in the household working. The majority, also 56%, were in dual-parent households, so the majority of families affected are dual-parent households with somebody in employment. That is proof that the policy is based on falsehoods and proof that the bigger issue is that too many people are in low-paid, insecure jobs, and that is the issue that should be tackled.

What about the people who have lost jobs or faced reduced income due to covid? They now find that the so-called safety net of the welfare state is a lot smaller than they would have anticipated. The Tory Brexit has also impacted jobs, too. The Tories deny that, but I have a meeting tomorrow with somebody who runs a haulage company, and he is close to going under, which will take other jobs with him, because of the ludicrous cabotage rules that the Tory Government signed up to.

Covid unfortunately gave us fire and rehire—another policy that the Tories have done nothing to eliminate, but a policy that is vastly reducing the incomes of thousands of workers or seeing them sacked. Workers that the Tories might otherwise have seen as model families who were able to afford their children without welfare support will now need that support, and it might not be there for them. Families and people who have lost jobs are now having to readjust their outgoings accordingly, and now find that they have been categorised as scroungers by the Tory Government.

Another key issue of the two-child policy is that, as others have said, it disproportionately affects orthodox Jewish and Muslim families who may have religious or ethical views on family size. I agree with the intervention by the hon. Member for Strangford that the religious aspect in terms of discrimination has possible human rights implications as well.

We have heard that some women have considered abortion because they worry about not being able to afford a child. There are debates about how many women have actually undertaken an abortion because of that, but the reality is that women are having to face that choice, and they should not have to. Again, that is something the Minister needs to look at and review.

Photo of Carol Monaghan Carol Monaghan Shadow SNP Spokesperson (Armed Forces and Veterans), Shadow SNP Spokesperson (Education)

There are debates about that, but the statistics are clear. The National Audit Office numbers show that since 2016, since the policy came into being, there has been a 24% increase in the number of abortions in England and Wales.

Photo of Alan Brown Alan Brown Shadow SNP Spokesperson (Energy and Climate Change)

I thank my hon. Friend for that. I will not disagree. The hon. Member for Strangford also referred to evidential work done by the LSE. This is evidence that the Government should look at. We are discussing a Government who talk about family values. How can they talk about family values when they are forcing women to consider abortion?

That takes us to other evidence of the impact of this policy. Since 2013-14, child poverty among larger families has risen dramatically; almost half of all children living in families that have more than two children live in poverty. Also, recent research for the report “Benefit changes and larger families” by largerfamilies.study shows that most of the recent rise in child poverty overall has been driven by rising poverty among those larger families.

Sara Ogilvie of the Child Poverty Action Group has said:

“The two child limit is a brutal policy that punishes children simply for having brothers and sisters. It forces families to survive on less than they need, and with soaring living costs the hardship and hunger these families face will only intensify.”

Also, according to CPAG:

“Removing the policy would lift 250,000 children out of poverty”,

doing so immediately. So, surely the Minister must review the evidence, act accordingly and take that action to

“lift…children out of poverty”.

Then, if we look at the rape exemption clause, it is apparent that it was thought up on the hoof at the time. It was probably some loose nod by the Government towards thinking that they were adding a moral, even noble, exemption to support children born after their mother’s traumatic experience of being raped. However, it is no wonder that Ministers at the time could not even explain how the policy would be implemented, because it was so absurd. No thought was given to the traumatic psychological effects of a woman having to relive such an experience and being asked to fill in forms to justify financial support for her child. Also, the bizarre logic of the exemption only applies for subsequent children, beyond the two-child limit, born of rape. So, as if the clause in itself is not abhorrent enough, it is somehow seen as being morally okay to decide which child born from rape is worthy of support, which is truly disgusting.

The other big thing aligned with this policy and other policies at the time was the whole “balancing the books” mantra. This debate made me revisit the 2015 summer Budget Red Book. I looked back at that and honestly it is truly horrifying to see how evil that Budget was. The two-child clause was estimated to save £3.4 billion by 2021; freezing benefits, £11.3 billion; benefit cap reduction, £1.7 billion, clawed back from the poor; and increasing the tax credits taper to 48% while reducing income thresholds for tax credits and work allowance was estimated to save—astonishingly—nearly £20 billion by 2021. So, there was a complete and utter hatchet job on the welfare state, and there were also incoherent policies, given the attack on some of the job-related welfare support—so much for “making work pay”. That was an awful Budget and I have to point out that it was shameful that Labour abstained on it.

However, what about the “balancing the books” mantra? Clearly, as I have just illustrated, it is “balancing the books” on the poorest, the most infirm and the lowest-paid in society. But what it also allowed in subsequent Budgets was tax giveaways to those who the Tories deemed worthy of benefiting from them.

Previously, I had the Library conduct analysis on some of the key Budget decisions that were implemented from 2016 to 2018. The Library extrapolated those figures, which were based on figures that were presented in the Budget books, up to 2025, and it estimated that, up to 2025, the Treasury was giving away £80 billion. Increasing the higher rate threshold was estimated to be a giveaway worth £5 billion; changes to individual savings accounts, or ISAs, £7 billion; inheritance tax changes, a £6 billion giveaway; and the personal allowance increase and further raising of the higher threshold to £50,000 of income was estimated to be an £11 billion giveaway by the Tories. There was also a £50 billion giveaway in corporation tax, although at least they realised the error of their ways on that one. All of that shows that plenty of money was found for giveaways, rather than for continuing to balance the books properly. And those figures show that the Tories could easily afford to reverse this two-child policy, if the political will to do so was there.

Returning to the here and now, another issue with universal tax overall is of course the removal of the uplift, or—more appropriately—a cut of £1,040 a year. As the hon. Member for Cynon Valley said, if the pandemic merited an uplift to allow people a more dignified life, then surely—with inflation running at 7% to 8%, the energy cap up 75% compared to April 2021 and petrol at record prices—there is a clear need for a permanent increase in universal credit.

I cannot finish without comparing this with what is happening in Scotland with the Scottish Government, just as my hon. Friend the Member for Glasgow Central did. The Scottish Government introduced the game-changing child payment, doubling it to £20 a week, and it will increase to £25 a week when the benefit is extended to under-16s at the end of this year. As that has been done on a fixed budget in the Scottish Parliament, it cannot have the positive impact it otherwise would have had because we are still living with the impact of Tory austerity. That is proof that whatever the Scottish Government do is undertaken with one hand behind their back. It is interesting that there was a strong theme earlier in the debate about the Welsh Government needing more powers too, so Tory policies are clearly having an impact on the Union, which should make the Minister take note.

Will the Minister pledge to review the effects of the impact of the Scottish Government’s child payment policy and the support it has received from charitable organisations? The Scottish Government have shown that they are treating all children equally. That should not be too much to ask of any Government, and surely it is time for the UK Government to think again.

Photo of Karen Buck Karen Buck Shadow Minister (Work and Pensions) 2:31 pm, 21st April 2022

It is a pleasure to respond to this debate under your chairmanship, Mr McCabe. I congratulate Alison Thewliss on introducing it. We have heard some very strong contributions from Members, both speeches and interventions, outlining the community impact of this policy and drawing on personal life experiences, which should inform debates such as this.

Tackling child poverty should be a moral imperative. This policy and others introduced by the Government over the last 12 years are major impediments to our moral imperative to end child poverty. Five years on from the introduction of the two-child limit, we are finally beginning to see the results of that social policy experiment and to be in a position to evaluate whether the policy achieved the purposes set out for it, and whether it had impacts that were foreseeable but were not what the Government explicitly sought to achieve.

As we have heard, as of April last year, 317,500 families and over a million children were affected by the policy. We are now able to understand just what a damaging impact it is having. For a few minutes, I will focus on what the Government sought to achieve and the arguments that were set out when the policy was introduced in the 2015 legislation, and how it has measured up.

Let us look at the Government’s attempt to define the problem. The former DWP Minister, Lord Freud, speaking in the other place, said:

“Currently, the benefit system adjusts automatically to family size, while many families supporting themselves solely through work do not see their budgets rise in the same way when they have more children.”—[Official Report, House of Lords, 7 December 2015; Vol. 767, c. 1328.]

The 2015 Budget said:

“The government believes that those in receipt of tax credits should face the same financial choices about having children as those supporting themselves in work.”

The fact that benefits adjust “automatically to family size”, as Lord Freud said, might be seen as a positive feature of the system rather than a bug, but the phrase that keeps recurring is

“supporting themselves solely through work”,

in contrast with being

“in receipt of tax credits”.

What is meant by supporting oneself “solely through work”? It tells us a great deal about this Government’s attitude towards our society and our welfare state, and their lack of interest in or concern about them. At the time those statements were made, two thirds of families in receipt of tax credits were in work—yes, that goes for families with three or more children as well. It is clear that the Government were predominantly referring to working families when they contrasted them with those

“supporting themselves solely through work”.

The word “solely” is carrying awful lot of weight in that sentence.

I have three points. First, the group that is, in the Government’s view, not supporting itself “solely through work” now comprises 42% of all families with children. That is the share of all families with children that are receiving tax credits or universal credit. How plausible does the Government’s problem definition sound when we are talking about nearly half of all families, rather than an unspecified minority?

Secondly, the Government’s idea of what it means to support oneself solely through work needs examination. Why are tax credits and universal credit the only parts of the welfare state that are singled out? The Office for National Statistics publication “Effects of taxes and benefits on UK household income” shows that most families with children—60%—receive more from the welfare state in cash benefits and the value of services than they pay in taxes. Even after taxes, the value of benefits and services received by families with children in the fifth decile is equivalent to 23% of their market incomes.

Our welfare state redistributes resources towards families with children on a large scale, and that is exactly how it should be. However, it means that most families with children cannot be said to be supporting themselves solely through work, but through a combination of work and state support, because we believe that the state has a role in supporting children. That is absolutely the purpose of the welfare state. This is not a permanent situation for most families. Over the life cycle, most of us move between being net beneficiaries—not supporting ourselves only through work—and net contributors at different points. That is also exactly how the system is supposed to work. That brings me to my third comment on the purported problem that the two-child policy was supposed to address: the Government simply ignored the fact that people move on and off tax credits and universal credit all the time. Instead, they want to treat recipients as an immobile group of benefit recipients, as if it was a permanent characteristic of some people.

Surely, after the huge rise in universal credit claims during the pandemic, even the Government must realise that whether a family will have to rely on social security benefits is something they cannot predict. The most charitable view possible is that the Government got themselves in a muddle by trying to impose a disastrously over-simplified vision on to a reality that it did not fit. A less charitable view is that they decided on a policy for whatever reason—austerity, they would say, although I might be more inclined to believe that it was political opportunism—and then set themselves to manufacturing a rationale for it.

Even if we suspend our disbelief and take the Government’s rationale seriously, we now have evidence against which it can be assessed. If tax credits incentivised people to have large families, the policy should have led, by now, to measurable changes in the number of births to families that already have two or more children. That has not happened, as the thorough and fair-minded research by Mary Reader, Jonathan Portes and colleagues has shown.

If any good has come out of this awful policy experiment, it is that the hypothesis on which it was based can be firmly rejected. Meanwhile, the situation for families with three or more children continues to worsen. As Ruth Patrick and her colleagues at the LSE have shown, those families are particularly vulnerable to changes in social security policy. The record over recent years shows just how severe the impact of austerity has been.

As the Government do not like the standard relative poverty measures that everyone else talks about, I will refer to their favourite measure: so-called absolute poverty, where the poverty line is fixed in real terms at 2010-11 values. The reason this Government like that measure so much is that it tends to show a downward trend over time as real incomes rise—although the downward trend since 2010 has been remarkably weak. For families with three or more children, the trend in absolute poverty after housing costs was in the opposite direction, with 300,000 more children in absolute poverty between 2016-17 and 2019-20. Some 38% of all children in those families are in poverty, measured against a threshold that was set 12 years ago. Measured against a contemporary poverty threshold, 47% are in poverty after housing costs, up from 41% in 2016-17. It is not solely due to the two-child policy; the whole raft of austerity measures since 2016-17 has particularly impacted these families.

However, the two-child policy can only drive child poverty higher, as more children born since 2017 come within scope of the policy. As we have heard, the Resolution Foundation’s modelling shows poverty for children in these families rising precipitously, with half of those children already in poverty in 2021-22. The Government should respond to that by ditching the two-child policy now. That would be the correct response to the evidence and would remove from our social security system the obscene requirement for rape victims to provide evidence to the Department for Work and Pensions of what the Government term “non-consensual conception.” It would remove the perverse incentive for couples with separate families to maintain two separate households and it would help to address the rise in child poverty, restoring the principle that our welfare state treats all children equally.

Photo of David Rutley David Rutley Assistant Whip (HM Treasury), The Parliamentary Under-Secretary of State for Work and Pensions 2:40 pm, 21st April 2022

It is a pleasure to serve under your chairmanship, Mr McCabe; we have seen a fair bit of each other this week. I congratulate Alison Thewliss on securing this debate, on a subject on which I know she has campaigned at length. In fact, we have sparred on a few different issues, because this is not the only subject she has concerns about.

The Department for Work and Pensions is committed to supporting families and helping parents into work. Since this has come up in the debate, it is worth reminding colleagues of the 1.3 million vacancies available for people to find work. We want there to be strong work incentives to help people to fill the opportunities that are available, while providing support for those who need it. We also need to ensure that there is a sense of fairness for the taxpayer; many working families who do not receive benefits do not see their incomes rise when they have more children. That is why we judge that the policy to support a maximum of two children, whether that is with universal credit or child tax credit, is a proportionate way to achieve those aims. Our overall approach is working, as evidenced by the fact that between 2016 and 2021, the number of couples who are in employment and have children increased by 460,000; that is a 2.3 percentage point increase in the employment rate for that group.

The two-child policy was introduced five years ago. Since April 2017, families have been able to claim support for up to two children. There may be further entitlement for other children if they were born before 6 April 2017 or if an exception applies—I will come back to that in a minute. The child element of universal credit is worth £290 for the first child born before 6 April 2017. It is worth a standard rate of £244.58 per child for the second and any other eligible children. Child benefit continues to be paid for all children, plus the additional element in child tax credit or universal credit for any disabled children. The 2021-22 rates for the disabled child addition in universal credit are £128.89 per month for the lower rate and £402.41 per month for the higher rate. Additional help for eligible childcare costs through working tax credit and universal credit are also available, regardless of the total number of children in the household. We discussed that at length in the Work and Pensions Committee yesterday—although that feels like quite a long time ago.

We recognise that some claimants are not able to make the same choices about the number of children in their family. That is why exceptions have been put in place to protect certain groups. Exceptions apply to third and subsequent children who are additional children in a multiple birth; an extra amount is payable for all children in a multiple birth other than the first child. Exceptions also apply where the child is likely to have been born as a result of non-consensual conception, which for this purpose includes rape or where the claimant was in a controlling or coercive relationship with the child’s other biological parent at the time of conception. A further exception applies to any children in a household who are adopted when they would otherwise be in local authority care, or who are living long term with friends or family and would otherwise be at risk of entering the care system. Another exemption is where a child under the age of 16 who is living with their parents or carers has a child of their own—until they make a separate claim upon turning 16.

Statistics from the Office for National Statistics show that in 2020, 85% of all families with dependent children had a maximum of two in their family. For lone parent families, the figure was 83%. Based on the latest figures, 62% of households with a third or subsequent child who are in receipt of universal credit or child tax credit are not affected by the two-child policy.

Photo of Hywel Williams Hywel Williams Shadow PC Spokesperson (International Development), Shadow PC Spokesperson (Work and Pensions), Shadow PC Spokesperson (Defence), Shadow PC Spokesperson (Cabinet Office), Shadow PC Spokesperson (International Trade), Shadow PC Spokesperson (Foreign Affairs), Shadow PC Chief Whip

The Minister has given a long list of the benefits available to people and some of the ameliorative procedures that have been put in place, but what is the actual effect of the two-child limit? Is he saying that it has no effect at all or that its effects have been ameliorated? What is the effect on the kids in those families?

Photo of David Rutley David Rutley Assistant Whip (HM Treasury), The Parliamentary Under-Secretary of State for Work and Pensions

The point that I am trying to make is that the benefits system is important—it provides support—but it is not the only thing that we are trying to do for people and for claimants.

As Ms Buck has highlighted, many of those people are working while on benefits. We want them to get into work and, when they are in employment, to progress. As has been debated long and hard in this Chamber, we have recently introduced work coaches who focus on in-work progression; we have 37 champions across the country who are helping to push that agenda forward. That is vital so that people can progress. People do not depend just on the benefits system; we want them to see more in their wage packet, and we have provided work incentives to do that, be it through the UC taper rate changes that have been put in place or through the increased work allowances. Those are vital incentives.

Photo of David Rutley David Rutley Assistant Whip (HM Treasury), The Parliamentary Under-Secretary of State for Work and Pensions

I will give way to the SNP spokesperson, but then I will make some progress, because others have made many points and I have several to make myself.

Photo of Alan Brown Alan Brown Shadow SNP Spokesperson (Energy and Climate Change)

I thank the Minister for giving way. On the point about helping people’s wage packets and making work pay, does he not agree that the minimum wage should reflect the national living wage so that people get a proper, fair wage?

Photo of David Rutley David Rutley Assistant Whip (HM Treasury), The Parliamentary Under-Secretary of State for Work and Pensions

As I think the hon. Gentleman knows, the national minimum wage has gone up to £9.50—[Interruption.] There is a bit of head-shaking going on; it is very disturbing. The national minimum wage is now £9.50 and is projected by many to reach £10. The £9.50 figure is a 6.6% increase, which is very welcome. I am sure that the hon. Gentleman will join me in welcoming that significant increase.

A few things have been said about the non-consensual conception exemption. We recognise that it is a difficult and sensitive issue, and we have put in place procedures that are mindful of the sensitivities involved. Third-party professionals include healthcare professionals, registered social workers and relevant specialist charities, which can also signpost claimants to further support, so claimants will get the support that they need and be assisted through the light-touch processes in challenging circumstances. The hon. Member for Glasgow Central made a point about rape conviction rates. I reassure her—I think she knows this, but let me put it on the record—that the criteria for the non-consensual conception exemption is much wider than just conviction. The third-party professionals can assist in those circumstances as well.

Jim Shannon, who I think everybody in this Chamber loves, highlighted many situations—nearly all of them, actually. I agree with him that there are a few exceptions, but clearly, we will have differences of opinion on this point. He and I share a love of ensuring that people can express their faith freely—that is a fundamental part of our democracy—and the policy does not seek to get in the way of that vital democratic right and freedom that we all cherish. The Government have published an impact assessment noting that ethnic minority households may be more likely to be impacted by the policy because they are, on average, more likely to be in receipt of child tax credit or universal credit, or to have larger families. That could also be the case for households of a particular religion, but the DWP has insufficient data to confirm that. I highlight that the Supreme Court found that the two-child policy was lawful and not in breach of the European convention on human rights.

Points have been made about abortion and fertility rates. The Nuffield Foundation’s research consortium on larger families has this month published a report outlining that fertility rates for those claiming, or eligible to claim, benefits have changed very little since the introduction of the policy. That would seem to refute the evidence from the British Pregnancy Advisory Service that was discussed earlier. The policy was never designed to affect fertility rates; it is fundamentally about seeking to provide fairness with those who are unable to access benefits, when it comes to the choices that they have to make.

The hon. Member for Glasgow Central also asked the question—

Photo of David Rutley David Rutley Assistant Whip (HM Treasury), The Parliamentary Under-Secretary of State for Work and Pensions

I do not think that the hon. Member was here for the whole debate. I will take interventions from others, who have had the courtesy to be here for the whole debate, but I will carry on for now.

On the point about monitoring, we are keeping all our policies under review, but this policy seeks to strike the right balance between supporting those in need and fairness for taxpayers and those who support themselves primarily through work, who do not see their incomes rise when they have more children.

The hon. Members for Arfon (Hywel Williams) and for Cynon Valley (Beth Winter) made some points about poverty and whether this policy is impacting it. I am sure they are assiduously following the latest households below average income statistics, which show that the support we put in place around benefits and incentives for people to get into work—creating a vibrant labour market so that people can get into work and progress—means that 1.2 million fewer people were in absolute low income, before housing costs, in 2020-21, compared with 2009-10. That included 200,000 fewer children and 500,000 fewer working-age adults. Furthermore, there are now nearly 1 million fewer workless households and, very importantly, almost 540,000 fewer children living in such households than in 2010.

Photo of Karen Buck Karen Buck Shadow Minister (Work and Pensions)

Can the Minister confirm that he accepts the point I made in my speech—that the number of families with three or more children that are in absolute poverty has gone up significantly?

Photo of David Rutley David Rutley Assistant Whip (HM Treasury), The Parliamentary Under-Secretary of State for Work and Pensions

Our policy is to seek to ensure that we get more children out of workless households, which we are succeeding in doing, and that there are more employment opportunities for people. We are moving that agenda forward very successfully in the current labour market, and we need to continue to move it forward.

The most sustainable way to lift children out of poverty is by supporting parents to get into, and progress in, work wherever possible. The Government have consistently said that the best way to support people’s living standards is through good work, better skills and higher wages. We have provided significant work incentives, which I have already highlighted, through universal credit, but also through our plan for jobs and the kickstart and restart schemes, which demonstrated the Department’s commitment to supporting families to get into, or to progress in, work. We have a range of policies that support people and families across the tax and benefits systems, and the household support fund for those who are particularly vulnerable.

I would highlight, one final time, that on 9 July 2021, the Supreme Court handed down the judicial review judgment on the two-child policy. The court found that the policy was lawful and not in breach of the European convention on human rights. The policy to support a maximum of two children strikes a balance between providing support for those who need it and ensuring a sense of fairness to taxpayers.

Photo of Alison Thewliss Alison Thewliss Shadow SNP Spokesperson (Treasury) 2:53 pm, 21st April 2022

I thank all hon. Members who came to today’s debate. I am grateful to them for their support and to those who came to speak or make interventions, because this issue has not gone away. It will continue to get worse as more families move into the scope of the two-child limit. I give particular thanks to Jim Shannon, because he has been at my side through all of this debate, right from the very beginning, and I am particularly grateful to him for that.

My hon. Friend Alan Brown made the point that at a stroke—by getting rid of this policy—we could lift 250,000 children out of poverty tomorrow. If the Government had the power to lift 250,000 bairns out of poverty, why would they not do it? Why would you deny those children the dignity and fairness of having a warm meal in their tummy and having the heating on at night? Why would you do that? I do not understand.

I will continue to campaign on this policy. I will not let it be forgotten, because there are constituents in Glasgow Central, as there are in every constituency up and down these islands, who are being affected by this, and there are more and more of them every single year. I will be there until this policy is gone. I will keep campaigning on it, because it remains an injustice—it was always an injustice. To value some children more than others cannot be allowed to stand in a moral society. I thank everybody who has come to contribute to this debate.

Question put and agreed to.

Resolved,

That this House
has considered the two child limit of working tax credits and universal credit.

Sitting suspended.