The government has launched a new child poverty strategy, described by Keir Starmer as a “moral mission” aimed at lifting half a million children out of hardship. This document marks the first comprehensive plan of its kind in over a decade and has been hailed by the Resolution Foundation thinktank as a “sea change” in Britain’s approach to addressing child poverty. The strategy, initially promised for spring, was delayed as cabinet ministers deliberated over the highly impactful policy of lifting the two-child limit on universal credit. Its eventual announcement, particularly by Rachel Reeves at the budget, has been warmly received by many Labour MPs.

A central pillar of this strategy is the lifting of the two-child benefit limit, a policy expected to yield the most significant and immediate impact. Projections indicate that this measure alone will lift 300,000 children out of relative poverty by 2027, with the number rising to 450,000 by 2031. While acknowledging some concurrent poverty-producing measures, such as the freeze in local housing allowance, the Resolution Foundation still forecasts 300,000 fewer children living in poverty by the end of the current parliament. This achievement, they suggest, would bring the government's record “not that far shy of that achieved by the first Blair administration” between 1997 and 2001. The Work and Pensions Secretary, Pat McFadden, highlighted this flagship policy, noting its £3bn cost to the Treasury and its crucial role in the overall aim to improve young lives for the long term, enhancing future employment prospects.

Beyond the two-child limit, the strategy encompasses several other key initiatives. The extension of eligibility for free school meals, a measure announced earlier but reaffirmed as vital, will make more than half a million additional pupils in England eligible from September next year. This applies to families receiving universal credit above the current £7,400 income cap, building upon existing provisions that cover 2.1 million disadvantaged children. Estimates suggest this will help lift 100,000 children out of poverty by 2028. Furthermore, the Labour manifesto pledge to provide free breakfast clubs for primary schoolchildren in England is now under way, with partnerships already established with companies like Weetabix, Morrisons, and Sainsbury’s to maximize impact and ensure access to nutritious food while freeing up school time.

Addressing immediate crises, the government is making new efforts to end temporary accommodation within six weeks. An £8m pilot programme will be trialled in 20 council areas, aiming to move homeless families from temporary B&B accommodation into permanent homes swiftly. If successful, this scheme could be expanded. Complementing this, councils will have a new duty to inform schools, GPs, and health visitors when a child is placed in temporary accommodation. Ministers will also collaborate with the NHS to prevent mothers with newborn babies from being discharged back to unsuitable housing, such as B&B hostels. Recent figures showed 2,070 households with children had been in bed-and-breakfast accommodation for over six weeks, despite legal limits.

To enhance accountability and understanding of poverty's depth, the strategy introduces a new measure of ‘deep material poverty’. While there isn't a binding target, the estimate of lifting over 500,000 children out of relative poverty serves as a benchmark. Experts acknowledge “considerable uncertainty” but welcome the new measure, which initially shows about 2 million children experiencing deep material poverty. This metric identifies the most deprived children based on essential items they are forced to do without, providing a valuable indicator for assessing the long-term effectiveness of government policies.

Additional measures include making it easier for parents to choose cheaper baby formula. The government will implement recommendations from the Competition and Markets Authority (CMA) to inform parents that all baby formula contains identical ingredients, removing the perceived need to buy more expensive brands. Rules will mandate that all infant formula products must be displayed together in shops. The strategy also focuses on extending the availability of refunds of upfront childcare costs from next year, making it easier for new parents receiving universal credit to return to work by preventing debt traps associated with high upfront childcare expenses. Finally, the government has vowed to improve the child maintenance system through an overhaul, promising a new service in the coming years with enhanced ability to identify and act on non-compliance, halving fees for users while maintaining a 20% fee for non-resident parents who fail to pay.

Alongside these specific poverty reduction measures, Work and Pensions Secretary Pat McFadden emphasized the government’s broader commitment to welfare reform. He stated that the UK welfare system is currently not doing enough to help people into work and is incurring significantly rising costs, indicating that further changes are on the horizon. McFadden argued that getting people into jobs is crucial for making families better off and reducing the overall benefits bill, viewing the strategy as “more than the distribution of money” but an “investment in the future.” He firmly rejected the notion that reform was halted, despite previous victories like the abandonment of disability benefit cuts. Chancellor Rachel Reeves echoed this sentiment, asserting that the benefits bill cannot “remain untouched.”

McFadden detailed two ongoing reviews: the Timms review on disability benefits and an Alan Milburn-led examination of youth inactivity. While not specifying cuts or eligibility reductions, he emphasized the need to address rising inactivity and enhance opportunities across government departments. He presented an economic rationale, stating that a young person staying on benefits could lose £1 million in earnings over their lifetime, costing the state a similar amount. Thus, helping individuals into work not only improves their finances and prospects but also generates tax revenue, leading to genuine savings on the benefits bill. He also countered Conservative claims, asserting the 2017 two-child limit was a political dividing line rather than a cost-saving measure, and that framing welfare around a division between “working and non-working” is “factually wrong.”