Universal Credit (Removal of Two Child Limit) Bill [HL]

Baroness Brinton Excerpts

2nd reading
Friday 8th July 2022 Lords Chamber

[Baroness Brinton (LD) [V]]

My Lords, I thank the right reverend Prelate the Bishop of Durham for bringing forward this important Private Member’s Bill and for his excellent introduction to it. I add support for it from the Liberal Democrat Benches.

I thank the Library for its helpful briefing and the Centre for Analysis of Social Exclusion at the London School of Economics for its report on the fertility effects of the two-child limit on universal credit, while the noble Lord, Lord Desai, has just given us a useful reminder of the history of benefits, including far too many anomalies in universal credit.

As other noble Lords have pointed out, this is a very short Bill with a clearly defined aim to remove the two-child limit, which was brought in in the Welfare Reform and Work Act 2016. As the noble Baroness, Lady Bennett, said, it was pernicious. It was legally challenged almost as soon as it was introduced in 2017. In 2021, the Supreme Court decided that the two-child limit does not breach human rights law, but it considered that Articles 8 and 14 of the ECHR applied in the following ways. It said that, as more women than men are responsible for bringing up children, the two-child limit has a greater impact on women than men and arguably “indirectly discriminates against women”. It also said that it arguably

“discriminates against children living in households containing more than two children, by comparison with children living in households containing one or two children”.

But the Centre for the Analysis of Social Exclusion at the LSE gives more worrying evidence about the effect of the two-child limit, which I suspect was not fully understood when the Government changed the law in 2016. As the right reverend Prelate the Bishop of Durham said, the Government were clear that there were two objectives when this was introduced. The first was fiscal prudence and the second was stated in a 2015 DWP impact assessment:

“In practice people may respond to the incentives that this policy provides and may have fewer children. There is no evidence currently available on the strength of these effects although the Institute for Fiscal Studies found a relationship between support for children in the benefit system and childbearing.”


However, the more recent case research suggests that the probability of having a third or subsequent child declined by 0.36 percentage points after the reform. It goes on to say:

“This is a much smaller effect than one would expect given existing evidence on welfare and fertility … qualitative research by our sister project, Benefit Changes and Larger Families, suggests that lack of information about the policy may be a factor. Approximately half of participants affected by the two-child limit did not know about the policy before having their affected child … If families don’t know about the policy prior to pregnancy, fertility effects are unlikely.”


This is the problem. It is perhaps not surprising that prospective parents are not familiar with the detail of the rules relating to universal credit until they affect them. Frankly, many recipients of benefits find the complex rules hard to understand at the best of times.

Current levels of child poverty should also force us to rethink this policy. Much has changed in the six years since the introduction of the two-child limit. The IFS found that inflation for those on low incomes is three percentage points above the national average. If the national average is currently just under 10%, the poorest in our society are facing around a 13% increase. The current cost of living increases in energy, food and many other items mean that families reliant on universal credit are finding life not just difficult but impossible.

Action for Children reports that, even before the pandemic, 4.3 million children were living in poverty in the UK, up by 200,000 from the previous year and by half a million over the past five years. That is 31% of children. In London, the figure is 38% and, in Newcastle upon Tyne, child poverty rose from 28.4% to 41.2% over those five years.

Can the Minister explain why the two-child limit for universal credit should continue, given that the original IFS research, quoted in the government impact assessment, has not been borne out in practice, and given that child poverty has increased substantially, even before the very large increase in living costs this year? From the Liberal Democrat Benches, we strongly support the right reverend Prelate the Bishop of Durham’s Bill, because all the evidence shows that the reasons behind the Government introducing the two-child limit have not worked and that, instead, child poverty has increased substantially.