Universal Credit (Removal of Two Child Limit) Bill

Lord Babudu Excerpts

2nd reading & Committee negatived & 3rd reading
Thursday 12th March 2026 Lords Chamber

[Lord Babudu (Lab)]

My Lords, I look forward to hearing the remaining maiden speech, from my fellow newcomer and noble friend Lord Walker of Broxton. I congratulate the noble Baronesses who have delivered excellent maiden speeches already. Before I get to the substance of my contribution, I declare an interest as the executive director of Impact on Urban Health, part of an endowed foundation that funds organisations that have contributed to the Government’s child poverty strategy, including Child Poverty Action Group and Changing Realities.

In preparing for this debate, I was heartened to read of the extent of cross-party consensus on the need to address child poverty. Given how it has risen over the past 14 years, we must be clear that the current approach is not working. Building on contributions from other noble Lords, I will speak briefly about how people come to be on universal credit and run up against the two-child limit, who ends up in that situation and what it costs.

First, on how it happens, as we have heard, around half of those affected by the two-child limit were not on universal credit when they had their children. This is a circumstance that can befall so many of us—a break-up with a spouse, the loss of a job or a worsening of health. These are routes to universal credit for so many. Who ends up running against the two-child limit? It is women, in large part. Of the 450,000 households affected, more than half are headed by single mothers and only around 6,000 by single fathers. Black and ethnic-minority households are up to three times more likely to be affected than white households and 40% of affected households have a parent with a disability. The approach we are taking disproportionately affects women, ethnic minorities and people with disabilities.

What does it cost? We have heard from other contributions that the proposed changes will have a cost of around £3 billion a year, in the end. That is a lot of money by any means, but, stepping back, what is the broader cost of letting this limit stand? Extensive research by Child Poverty Action Group, the Joseph Rowntree Foundation and the Department for Work and Pensions has shown that those affected are more likely to experience poor physical and mental health and less likely to be in employment, education or training or to earn a decent wage in the long run. In several ways, this limit costs people the opportunity to live in good health, to earn well and to contribute to society. We are losing tax contributions and well-being.

I am incredibly sympathetic to the need to control our welfare bill. I sat on the Commission for Healthier Working Lives because I believe that work plays a hugely important part in enabling people to live well. But we must not forget that the majority of those affected by the two-child limit are already in working households. In due course, I will speak to the changes I believe we need in welfare more broadly, but today I want to be clear about one thing: this is not the way to build a healthier society or to save money. It ultimately costs us money. We know that we do not want children to live in poverty and that it is scarring their lives.

We have this opportunity. Removing the two-child limit is simply the most effective way to achieve meaningful progress on reducing child poverty. Other approaches have not been working since the limit was introduced and with the opportunity to achieve the biggest reduction in child poverty within any single Parliament, I urge noble Lords to signal their support for His Majesty’s Government and grasp this opportunity with both hands.