Child benefit cap to be lifted

Both matters which many of us in the LP have been pushing for a very long time for the moment of announcement.

If it goes ahead I would welcome the U turn.

Yet again Reform announce what they would do, and hey presto KS follows up with his announcement…

Yes, I noticed what Farage claimed, "its all due to him" and that is why I have written above about just how much pressure we in the L Party have been putting on our MP's from the very outset

Farage would claim that, wouldn't he? Anything to gain political capital. And he hasn't said how it would be paid for, of course.

Badenoch has decried them both today

"Kemi Badenoch has blasted Keir Starmer and Nigel Farage for making promises they “can’t deliver” if they pledge to scrap the two-child benefit cap.

Taking aim at the Reform leader amid reports he’s planning to outflank the prime minister on benefits by committing to restoring winter fuel payments and scrapping the two-child benefit cap, she said: "He's making the same mistake that Keir Starmer made of making promises, and then they'll get into government and can't deliver it."

This will be great news for Boris and Carrie …..

ronib

This will be great news for Boris and Carrie …..

Why?

This is not Family allowance/Child Benefit it is the number of children you claim for if you are in receipt of benefits, Universal Credit.

Just saying - there shouldn’t be another GE for four years. If Fromage becomes PM, I’ll eat my hat.

The two child benefit cap was introduced by the Conservatives in 2017 when Theresa May was PM.

I hope that other measures to combat child poverty will be introduced as well even if they are not as "cost effective" in the short term. Our children are our future.

I hadn’t registered that it wasn’t child benefit too Gg13 - but no wonder the birth rate is plummeting.

Not before time.

Magenta8

The two child benefit cap was introduced by the Conservatives in 2017 when Theresa May was PM.

I hope that other measures to combat child poverty will be introduced as well even if they are not as "cost effective" in the short term. Our children are our future.

It's always more than annoying when people assume Starmer brought it in because of the way it's presented.

GrannyGravy13

ronib

This will be great news for Boris and Carrie …..

Why?

This is not Family allowance/Child Benefit it is the number of children you claim for if you are in receipt of benefits, Universal Credit.

Not only that, but I suspect Johnson earns above the threshold for Child Benefit.

Stephen Flynn put pressure on immediately after the opening of Parliament. The seven Labour MPs who had to courage to vote with him were suspended for their principles. But now Starmer and Reeves are facing an increasing backlash from cabinet members, Kendall, Phillipson. Rayner and Streeting.

Farage is just bandwagon-jumping as usual.

There are no figures on how many families have four or more children but around 1.2 million families have more than two. At around £300 UC a month per additional child say it would cost £5 billion a year to remove the cap (Resolution Foundation says 3.5) .

Although there is a separate thread, I’d add in universal WFP which costs less that £2 billion so say a maximum £7 billion for the two.

There is more than enough money to pay both. Spending creates taxation. One would expect most of the additional UC for children to be spent on zero rated food and clothing but most of universal WFP was probably spent on taxable goods and services so the net cost would be less than £7 billlion.

It really is peanuts compared to the 1.3 trillion of government spending every year - just half a percent.

Betting is an obvious target to raise more taxes. Gaming, including betting and gaming, bingo, and lotteries are normally exempt from VAT (although the rules are complex). Why?

www.gov.uk/guidance/how-vat-applies-to-betting-gaming-and-lotteries-notice-70129

True, the sale of lottery tickets raises money for good causes - 28% for that but only 12% in lottery duty - making it cheaper to gamble than work. Additional lottery duty could be raised and taken from the 50% that currently goes to prizewinners. Double lottery duty and it would cover the gross cost of universal WFP.

Yes, I know all the arguements about giving it to people who don’t need it, but if they don’t, they will likely spend it on something that’s taxed at a much higher rate than domestic fuel.

Better that than divisive means-testing that leaves people on the cliff-edge.

We’ve had the experiment now to see who comes forward to claim Pension Credit. Relatively few made successful claims - only 5% of the anticipated number of households said to be eligible. Poor uptake is an ongoing issue that needs to be dealt with separately.

While we’re on the subject of gambling, I would get rid of Premium Bonds. They are currently responsible for £128 billion of public debt on which the Goverment pays out over £5 billion in interest (prize money) each year, tax free.

If the Resolution Foundation figures are more accurate than. mine (and they probably are), we could fund uncapped child UC and univeral WFP from that.

Most of that £5 billion goes to already wealthy individuals and couples who can afford to loan the government £50,000 to £100,000 - with no guarantee of a return - in the vague hope they might win one of only 24 million pound prizes each year.

The odds of winning a million pounds with one £25 bond is only 1 in 2,602,163,211 each month. The next biggest prize is £100,000 (78 of those) but if you afford to loan that much why bother as the chance of winning is still only 1 in 66,722,130.

I think that the apparent u-turns in child benefit, WFA and hopefully other disability benefits has a lot more to do with the threat of rebellion from back benchers rather than Farage

I've waivered on this, but I've come to the same conclusions as you Silverbrooks. My feeling is that the two child cap on child tax/universal credit and the WFA is about society saying that the very young and the elderly should be given a little extra support, whatever their individual financial circumstances.

The apparent u-turn concerning the child benefit cap has far more to do with Starmer's disastrous polling results, for him personally and for the Labour party, than for any concern over child policy. I wonder if the three Labour MPs still suspended will have the whip returned?

sigh.

Well I suppose from the outside you might say that, easybee, but you haven't been involved in the campaigns within the party from Constituency Labour Parties up and down the country on Child benefit and WFA.

So I profoundly disagree.

GrannyGravy13

If it goes ahead I would welcome the U turn.

Yet again Reform announce what they would do, and hey presto KS follows up with his announcement…

If you actually watch what the much applauded Nigel does you will see he behaves as Hesletine once described Johnson's behaviour. He watches to see where the crowd is going then runs in front shouting "follow me". And here we have him doing it again.

Why anyone would think he will actually keep such economically left-wing and socially liberal policy is beyond me but, as with Trump, those most likely to lose out under any government run by such people keep on believing they will keep their word.

Like you GrannyGravy13, I hope a way can be found to turn around a policy introduced by the Conservatives in 2017 so that they could give pre-election tax cuts.

No I most certainly have not be involved in any campaign, and Starmer is not contemplating a u-turn for any altruistic reasons.

Any policy which lifts more families out of poverty is to be welcomed, by me anyway. As it’s over four years until the next election, I doubt anybody will care by then what Farage says now, they will be more interested in the direct impact of the actual government policies on their finances.

How do you know he doesn't care about others? Politics is about what is possible, financially, and disagreements in the Labour Party have been mounting.

politicsnerd Well said on what Nigel Farage does, to gain votes that is, not out of any real concern for the poverty of families or any one else. He’s far too self serving for that, but why oh why people do so many people not see that is what is happening and keep on voting for him? None so blind as those who don’t want to see I guess!

ronib

This will be great news for Boris and Carrie …..

Why's that then?

From what I read, it may be Morgan McSweeney behind the hesitation over the cap:

^ … sources said Morgan McSweeney, Starmer’s chief of staff, was opposed to the move, arguing that while it would be popular with Labour MPs, the public viewed it as an issue of fairness. “He doesn’t think they would be getting enough political capital with voters as a result of the money they would have to put in,” one source said. ^ (Guardian)

but how does political capital trump child poverty? Over a few billion?

Usual hot air from Reform. Having withdrawn their election manifesto "contract" a few weeks after the General Election, sayiny it was unworkable, Tice is now rowing back on the promised rise in the tax personal allowance to £20,000:

A reminder:

_CRITICAL REFORMS NEEDED IN THE FIRST 100 DAYS_
Make Work Pay. Lift the Income Tax Start Point to £20,000 Per Year. This frees up to 7 million people from paying Income Tax and saves every worker almost £1,500 per year. Basic Tax rate stays at 20%. The higher rate should begin at £70,000.

Richard Tice has backed away from Reform UK’s promise to enact £90bn of tax cuts within 100 days if the party wins the next election. In an interview with The Telegraph, Mr Tice, Reform’s deputy leader, said the sweeping programme of tax cuts was meant only to indicate “the direction of travel”.

www.telegraph.co.uk/business/2025/05/21/reform-rows-back-on-tax-cut-pledge/

How many people voted for Reform for a tax cut?

As was blatantly obvious it would have had disastrous effects:

Simon French, the chief economist at the City stockbroking company Panmure Liberum, has warned that the UK would face an “immediate and violent” sterling crisis if Reform took power in 2029.

Sounds like Tice is a bit more realistic there than Farage. its actually quote a significant announcement - if it gets out to voters.