Government shows real ambition to tackle child poverty

The government has delivered a long-awaited and very welcome announcement this Budget – the total removal of the two-child limit.

This will immediately lift hundreds of thousands of children out of poverty. It could also prevent many more from being forced into poverty over the coming years of this Parliament. This is a bold move that demonstrates real ambition to tackle the causes of child poverty.

What is the two-child limit and how is it linked to child poverty?

The two-child limit is a restriction of the support families can receive through Universal Credit, limiting support to two children per family. This means that the third and subsequent children will not receive support worth £3,514 per year each. This lack of support is a major driver of rising child poverty in the UK.

• 1 in 9 children in the UK are affected by the two-child limit

• 59% of families affected have at least one parent working

How big of a problem is child poverty in the UK in 2025?

Research into public attitudes around poverty reveals that many of us see it as something from the past, or something that only really exists in other countries. But in reality, child poverty is still one of the biggest challenges our country faces. Despite our wealth and resources, more than four million children are growing up in poverty, according to our partners the Child Poverty Action Group (CPAG). Around 60% of these children live in working households, showing that low pay, insecure employment, and rising living costs are some of the biggest drivers.

The crisis is deepened by inequality. Children from Black and other racially minoritised backgrounds are almost twice as likely to be forced into poverty – 47% compared to 24% of white children – reflecting the systemic barriers in access to housing, employment, and credit. These inequities are not accidental; they are the cumulative result of decades of policy decisions, structural discrimination, and underinvestment in the services that support families to thrive.

The Government’s abolition of the two-child limit, alongside the establishment of the Child Poverty Taskforce and the extension of Free School Meals signal a welcome recognition of the problem. But real progress will only come through sustained investment that matches the scale of the challenge.

How are child poverty and health inequality linked?

Children’s health is inseparable from their family’s financial situation. Poverty does not exist in isolation, it directly shapes the conditions in which children live, learn, and grow. When essentials like food, heating, and clothing are made unaffordable for families, the consequences are immediate and far-reaching.

Research shows that children in households with problem debt are more than twice as likely to experience low wellbeing and face higher risks of anxiety and depression. Families under constant financial pressure often face impossible choices between heating and eating, and this chronic stress spills over into children’s emotional wellbeing.

National research reinforces this: children in financially secure households report significantly higher life satisfaction, while poor housing is strongly linked to poor mental health. In other words, ending child poverty is not only a moral and social imperative – it is a public health necessity.

A national commitment to children’s futures

If the UK is to become a fairer, healthier, and more prosperous country, ending child poverty must be at the heart of national policy. Every child deserves the chance to grow up in a safe home, to eat nutritious food, and to learn without the weight of financial stress.

Abolishing the two-child limit is a major step forward for the government in tackling the causes of child poverty. But action should not stop there. The upcoming Child Poverty Strategy needs to be supported by ringfenced funding that is reflective of the challenge the strategy is attempting to meet.