Statement on the Two-Child Cap — January 2026
Our UK Labour Government is committed to tackling child poverty and that is why we are lifting the two-child limit in full. It is estimated that reversing the two-child limit alone will bring 450,000 children out of poverty by the end of this Parliament.
The UK Government is also committed to reviewing Universal Credit and, to further support the lowest-income families, the maximum level of debt repayments that may be deducted from UC income each month was reduced from 25% to 15%. Thanks to this change, 1.2 million households will keep an average of £420 more of their award each year.
Many initiatives on child poverty are devolved, and the Welsh Labour Government is equally committed to tackling child poverty. For instance, it has invested £50 million in childcare, on top of its £100 million annual investment. In the Draft Budget for 2026-2027, the Welsh Government has said that it will continue to support its childcare offer. This will ensure funding for up to 30 hours of combined childcare and nursery education for three- and four-year-olds for up to 48 weeks a year, along with supporting the Flying Start childcare provision for two-year-olds.
Wales is the first nation in the UK to provide universal free school meals to all primary school children, which is worth £764 a year per child. Additionally, it provides support to parents to pay for school uniforms and equipment, and its Educational Maintenance Allowance of £40 a week is the most generous in the UK. It too is being supported in the Welsh Government’s Draft Budget for 2026-2027.
A key part of the Welsh Government’s new Child Poverty Strategy is the Welsh Benefits Charter. This has been adopted by all local authorities, confirming the collective commitment to improve access to financial support for people across Wales. It ensures easy access to the benefits people are entitled to, helping to put money in their pockets and help tackle child poverty.
This partnership between Welsh Labour and UK Labour Governments is the best way to protect our children from the terrible consequences of poverty and make sure every child has the best start in life.