Dame Meg Hillier of the UK parliament’s Public Accounts Committee encourages the UK to end the two-child benefit cap. In her view, this transformation is a moral imperative and an economically smart move. This cap was implemented in April 2017. It limits means-tested benefit programs to two children per family, punishing those with multiple children and cutting off vital support they need to survive. Hillier’s remarks, made on Labour conference floor, follow mounting pressure on Labour leader Rachel Reeves from the grassroots membership to reverse this policy.
Hillier as she passionately argues against the UK’s record-high rates of child poverty. She links this crisis to the dismal state of education that far too many of our children are receiving. She argues that lifting the cap would go a long way to reducing the burden on families in financial distress. Hillier said that by raising the cap, the policy would instantly lift 350,000 kids out of poverty. Beyond that though, it would importantly lift 700,000 children out of deep poverty in one fell swoop.
The Labour Party is now under severe internal pressure to go further on child poverty. Hillier, the former chair of the powerful Treasury select committee, is not wishy washy on the need for the government to invest in youth. This investment is paramount for spurring sustained economic development and fulfilling deferred pension liabilities. It is the one, fastest thing you can do to get the results we want to see,” she continued.
At the same time, the federal government reaffirmed the commitment to table its first child poverty strategy before November’s budget. There are understandable concerns about the Administration’s delay in releasing this required report. Hillier stated, “If that report is not released in the next 2-3 months, then someone has buried it.” She noted that the report was primed to be released months ago, despite not being officially titled. The serious questions she raised about its ongoing failure to publish it and to appropriately target and address the root causes of child poverty more aggressively are critical.
Reeves has made high profile, public commitments to lowering child poverty and raising families out of poverty. She vehemently argues that solutions need to be cost-effective. “But we’ve got to ensure that the math is right,” she said. This hesitancy has been indicative of a bigger divide within the party over fiscal prudence versus social equity.
Tim Leunig, a former adviser to Conservative chancellors Sajid Javid and Rishi Sunak, has questioned the government’s commitment to addressing child poverty. In his own words, “This administration must determine what its purpose is.” His comments express a deepening exasperation among even the government’s friends on the political class over the direction of the government’s policy.
In a positive reaction to these arguments, Reform UK have promised to scrap the two-child benefit cap if they come into power. The current Conservative administration will have an uphill battle delivering on this commitment. Instead, they make the completely non-economic argument that abolishing the cap is not economically credible.
This problem is only exacerbated by the demographic transition occurring across the country. Nonetheless, the UK is experiencing perinatal record low birth rates. On top of that, there has been a drop in inflows of young European migrants—which threatens to harm long-term economic prosperity. Further policy discussions Comments on Leunig’s post reveal a sense of urgency about these demographic trends and what they mean for policy going forward.
The ensuing debate on pay has included the influential Resolution Foundation think tank. One group suggesting that poverty is up for reversal are UK charity Action for Children. This view is in line with Hillier’s recent opinion piece urging policy reform to use the central bank’s resources to meet these urgent social needs.
