Child Poverty

Lord Babudu Excerpts

Thursday 18th June 2026 Lords Chamber

[Lord Babudu (Lab)]

My Lords, I thank my noble friend Lady Lister for securing this important debate; she has spent decades making poverty visible when others preferred not to look. I declare my interest as executive director of Impact on Urban Health, a health equity funder. We fund organisations that work with children, such as Changing Realities, the Child Poverty Action Group and Save the Children. However, I am speaking today in a personal capacity.

Tackling child poverty and addressing its effects has been at the root of so much of my work over the last two decades. For much of that time, it has felt like trying to stop the tide going out. In my work, I have seen the poor-quality temporary accommodation that families get stuck in, to great expense for local authorities. I have seen the poverty that schools try their best to paper over, because the levels of need are such a barrier to learning.

I have heard stories of how families have unexpectedly found themselves underemployed and on universal credit. The numbers in this strategy bear that out. A child eligible for free school meals is already five months behind by the time they start school. One in four children from the poorest families gets five good GCSEs—the figure is three in four for children from the richest families.

In that context, I welcome this strategy. It is cross-government in design, it was built with families, and it has great policy content. Removing the two-child limit, as other noble Lords have said, is the most effective intervention the Government could have made to tackle child poverty. Extending free school meals to families on universal credit matters too, as do increases in the national living wage and rates of universal credit.

There are two less highlighted parts of this strategy that I want to name, because they point to things the Government are quietly getting right. The first is a plan to draw in private and social investment alongside public spending. Public money will not be enough. The Better Futures Fund has great potential: government paying for social outcomes, not activities, and using that commitment to pull in capital that would otherwise sit on the sidelines. It is already happening in Bristol, helping to finance affordable housing. We need more of these innovative solutions.

The second part is the commitment, repeated in the Child Poverty Strategy, to commence the socio-economic duty under Section 1 of the Equality Act. Nearly 16 years on from that Act’s commencement, it is beyond time for this duty to commence. I hope the Government can set a date for its commencement soon.

There are three areas where the strategy can and should go further. The first is binding targets. Child Poverty Action Group and Save the Children conducted research, funded by Impact on Urban Health, with 40 practitioners to help inform the strategy. On targets, those practitioners were unanimous. Binding targets matter not because they are magic but because, when there is no well-understood target to hit, it is easier for departments to deprioritise. With the baseline report on child poverty levels due this summer, now is a great moment to change that.

The second area is the benefit cap. The two-child limit removal is welcome, but the cap undermines it. The Government’s own impact assessment estimates that around 70,000 families subject to the benefit cap will see little or no gain from the two-child limit removal. The cap bears down on those in deepest poverty, especially sole-parent families, who make up nearly 70% of capped households. These are not people who can easily work more hours to escape it. They are often sole carers, many with young children. For them, the cap is not an incentive but a trap.

I have similar concern that the local housing allowance, which has long not kept up with the cost of housing in several cities and is currently frozen until 2027, will undermine the Government’s child poverty reduction ambitions, given that 1.7 million children living in poverty live in the private rented sector. I had planned to flag a concern about the child poverty unit’s closure and replacement by a team within the DWP, but it would be great if the Minister could clarify whether that will sit more centrally. Where accountability sits determines whether a cross-government strategy holds or quietly fractures. Scotland put its child poverty Act through its Parliament and set up a statutory independent commission to monitor delivery. That difference, if it exists, creates a risk.

This strategy was built in the right way: across government, with families, and taking evidence seriously. I want to see it delivered in the same way. That means targets set this summer, against which any of us can measure progress. It means a co-ordination function with real authority; and it means closing gaps like the benefit cap, the local housing allowance freeze and the socio-economic duty—still to commence—that will otherwise risk making the strategy land well short of what it could achieve.

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.