Universal Credit (Removal of Two Child Limit) Bill

Gareth Snell Excerpts

2nd reading & Money resolution
Tuesday 3rd February 2026 Commons Chamber

[Dr Sandher]

The rise happened before covid; it happened after the two-child limit was introduced. I agree with the hon. Lady on one point: she is not across the statistics.

Opposition Members have advanced an argument that I think is fair. They ask why we do not just create lots of jobs, which is the way to get out of poverty. The way to get out of poverty is through work, right? I want to take that argument head-on. We are living in a different technological era. In the post-war era, we had the advance and expansion of mass-production manufacturing, which meant there were good jobs for people as they left school. They left school, went to the local factory and earned a decent wage, meaning that they could buy a house and support a family.

Then, in the 1980s, in this country and indeed across high-income nations, we saw deindustrialisation and automation, bringing the replacement of those mechanical jobs with machines. Like other high-income nations across the world, we have been left with those who can use computers effectively—high-paid graduate workers—and lots of low-paid jobs everywhere else. It is not just us confronting that problem, although it is worse here because of decisions made in the 1980s; we are seeing it across high-income nations. As a result, state support is needed to ensure that those on low pay can afford a decent life.

[Gareth Snell (Stoke-on-Trent Central) (Lab/Co-op)]

Will my hon. Friend give way?

[Dr Sandher]

In a moment.

This is not, by the way, the first time in history that we have confronted this problem. In the early part of the industrial revolution, between 1750 and 1850, we saw machines replace human beings. What did we see then? The economy grew by 60% per person, but people had less to eat. Men were shorter in 1850 than in 1750 because of the change of the technological era. I think my right hon. Friend would like to intervene.

[Gareth Snell]

I am an hon. Friend, not right honourable, though I welcome the promotion.

I have listened to this debate from outside the Chamber this afternoon and heard many Conservative Members talk about how the route out of poverty is through work. I absolutely and fundamentally agree with that, so I find it completely incongruous that whenever they have had the opportunity to vote for our make work pay Act, to increase stability in work and create well-paid jobs, they have voted against it. Indeed, only last week, the shadow Secretary of State made an argument for cutting the minimum wage for young people. How does my hon. Friend think that someone can argue, on the one hand, for work as a way out of poverty, but on the other, restrict the opportunities for work, push down pay and reduce the opportunities created for working people?

[Dr Sandher]

I agree with my hon. Friend. Conservative Members have often spoken about their employment record in office and how many jobs were created. Yet while that happened, child poverty and child hunger rose. Something is not right in their model of the world and there is something to review there.

There is no law of economics that says that just because someone works hard and is a decent person, they will earn a wage that can support a family. That is not the technological era we live in today. That is why we are ending the two-child limit today and I am so proud that we are doing so.

In an economic sense—in pounds and pence—as Labour Members realise and have stated, when we ensure that children have enough to eat, they learn more today and they earn more tomorrow. The cost of child poverty every single year is around £40 billion. The cost of ending the two-child limit is about £3.5 billion. It makes sense to invest today so that our children can eat and learn more, yet this is not just a matter of pounds and pence; as an economist, I often talk about that and I get it, but it is about so much more. This is about the moral argument. No child in this country should go hungry—no ifs, no buts and no exceptions. That is why I am so proud of this Bill, I am so proud to vote to end the two-child limit and I am so proud to be sat on the Labour Benches.

--- Later in debate ---

[Andrew Pakes]

Certainly. Many of my food banks would support the single policy that we are voting on today, so I hope the right hon. Gentleman will join me in the Lobby tonight to vote to eradicate food banks. This Bill will put money into the pockets of families. It will not just lift their children out of poverty but—as my hon. Friend the Member for Morecambe and Lunesdale (Lizzi Collinge), who is no longer in her place, said—put money into the local economy.

If we ever wanted a symbol of the legacy of Tory failure in government, it is this: in my city of Peterborough alone, nearly 43% of children are growing up in poverty. In the North ward of Peterborough, which is a two-minute walk from my house, six out of 10 children are growing up in poverty. That is a stain on our society, and I am dedicated to eradicating it.

I am proud of the work that my council does, but this policy will help. I am proud of the focus of Peterborough city council, pushed on by groups such as Peterborough Citizens, which has ended the practice of children sleeping in bed-and-breakfast and hotel room accommodation. I was equally proud in the autumn to welcome the Prime Minister to Welland Academy, where he made the national announcement of the roll-out of free school meals for all children on universal credit. An incredible 16,000 extra children will benefit from free school meals this September because of the action taken by this Government, which will be delivered in the coming months.

We all know that we need to do more. The Bill is an investment in our country’s future. The single act of voting for it will lift 450,000 children out of poverty, including 10,000 in Peterborough. As many hon. Friends and comrades in this place have said, almost half of the families on universal credit are in work. Child poverty makes it harder for children to get on in life, and that hurts our economy. I am pleased to see that some Conservative Members have returned to the debate. I thought for a while that the lights were on but nobody was home—it turns out that that applies just to their policy on child poverty rather than to them as individuals. The Conservatives would do well to remember that these figures are not merely statistics; they tell a story of lost opportunity, of lost moments of childhood, and of lost potential not just for the affected children but for our local economies.

[Gareth Snell]

My hon. Friend’s point about lost moments of childhood is often missed. It is all well and good to talk about the impact on parents and on the economy, but having grown up in poverty, I remember walking to school with a hole in my shoe, and not being able to ask my grandparents for anything because they could not afford it. I remember feigning not wanting to go on school trips because I knew that they could not afford it. I remember making sure that the holes in my jumper were hidden when I got home because I knew that they could not afford to replace it. Those memories stick with people throughout their lives and continue to have an effect on them once they have grown up. This is not just about the economics of the here and now; it is about the real-life impact on young people today and in the future. I thank my hon. Friend for ensuring that those voices are heard.

[Andrew Pakes]

I entirely endorse my hon. Friend’s comments. It sounds as if we may have had similar childhoods, only in different parts of the country.

The statistics cited in this debate do not sit in isolation. It is no coincidence that, alongside high levels of child poverty, Peterborough also has some of the highest levels of low-paid and insecure work in the country. At the last count, and going by the Government’s definition, one in three working people in Peterborough are in chronically insecure work—largely zero-hours shift work, which the Conservative party voted to keep in our economy, while we voted to eradicate it. Peterborough has one of the highest numbers of adults with no qualifications. Despite our city’s wonderful industrial heritage, nothing says more about the wasted opportunities of the last 14 years than the 70% drop in level 2 and level 3 apprenticeships in Peterborough—that comes at a cost to the country.

Although I have painted a picture of the difficulties that many families face in my city, I pay tribute to the incredible ingenuity, determination and grit that parents demonstrate—often in difficult times and despite the adversity that they face—to do their best, look after their children, raise ambition and give people jobs and opportunities. We were sent here to serve them, and we will help them by voting for the Bill.

To be honest, the Conservatives have some brass neck to talk about poverty, as do our colleagues and friends in Reform UK. At one point, I thought that they were plastic Tories, but now that the transfer window has closed, I just think that they are Tories. I represent a wonderful, brilliant and diverse city, so the naked racism in the Reform amendment, which talks about denying support for hard-working families based on the birthplace of the parents, is an affront to democracy and to British values.

--- Later in debate ---

[Rebecca Smith]

No, I will not give way; I am going to make some progress.

These mums and dads are the backbone of our economy, and we cannot afford to let them down. Scrapping the cap reduces incentives for parents to look for a job or work longer hours. Why would they bother going to work, or working more, when they could get more in benefits? A strong economy must provide incentive structures that help people to do the right thing, and we tamper with these fundamental structures at our own peril.

[Gareth Snell]

On the point of doing the right thing, the data suggests that in the shadow Minister’s own constituency there are 1,160 children living in a household that does not currently receive universal credit support for the additional children. Some of them will be listening this evening, and some will be teenagers. What would she say to them? Would she tell them that she could do something this evening, but she is choosing not to? What is her justification to those children?

[Rebecca Smith]

I also speak for the 60% of the population who do not think we should be scrapping the cap. No doubt a large proportion of those people are also in my constituency.

As Conservatives, we believe in personal responsibility and living within our means. Our welfare system should be a safety net for the most vulnerable, not a lifestyle choice, as my hon. Friend the Member for Faversham and Mid Kent (Helen Whately) has argued so powerfully. As I have alluded to, it seems that we are not alone; that principle of fairness is echoed across the country, with a recent YouGov poll finding that 57% of respondents believe that the cap should be retained.

The situation is particularly stark for self-employed mothers, who can only access statutory maternity allowance —a flat rate that falls far below what their peers can receive via their employer. I recently met one self-employed mother who told me that she is seriously weighing up whether to have a second child because she and her husband simply cannot afford it right now. This is a deeply personal dilemma, fraught with conflicting emotions. Equally, those not on benefits who have more children do not get paid more wages—they just have to absorb the extra costs within their budgets—so this idea that we need to give people more money because they have more children does not always make sense. However, this Government are determined to give families on universal credit a free pass; as a result, those families will not have to make those kinds of hard choices.

According to the Institute for Fiscal Studies, for 70% of the poorest households currently subject to the two-child limit, any money they stand to gain from the scrapping of the limit will get partially or fully wiped out by the household benefit cap. How do the Government square that circle when they have been quoting the headline figures for poverty? As has been raised numerous times today by Opposition Members, if Labour truly followed its own logic on child poverty, it would also need to scrap the household benefit cap, at even greater cost to the taxpayer.

Conversely, 40% of those affected by the two-child limit will be exempt from the overall household benefit cap, because they have at least one claimant or child receiving health and disability benefits. This means that households with six children will get an additional £14,000 every single year. For larger families in particular, the financial gap between going to work and being out of work will shrink significantly. We are trapping good people in a bad system. Shockingly, one in four full-time workers would be better off on benefits than in work—that is 6 million workers across the UK whose neighbours on combined benefits are receiving more income than they are. It is no wonder that every day 5,000 people sign on to long-term sickness benefits. According to the Centre for Social Justice, a claimant who is receiving universal credit for ill health plus the average housing element and personal independence payment could receive the equivalent of a pre-tax salary of £30,100, and a family with three children receiving full benefits could get the equivalent of £71,000 pre-tax. How is this fairness?

At best, scrapping the cap is a sticking plaster that does not tackle the root causes of poverty. We know that work is the best route out of poverty—in fact, if this Government hit their ambitious target of increasing employment rates by 80%, that could lift approximately the same number of children out of poverty as scrapping the two-child limit. Instead, this Bill will be yet another strain on our ballooning benefits budget. If it had been retained, the two-child limit would have saved the taxpayer £2.4 billion in 2026-27, rising to £3.2 billion in 2030-31. Instead, the bill is being passed on to all those families I have spoken about already.