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Child Benefit Cap in England Fuels Poverty: A Deep Dive

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Safak Costu
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Child Benefit Cap in England Fuels Poverty: A Deep Dive

A significant Conservative policy in England, which restricts child benefit payments to the initial two children in a family, has been spotlighted as a crucial contributor to child poverty, especially in the north and Midlands areas. The policy, in effect since April 2017, was introduced to align the financial decisions of families on benefits with those of working families.

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Disproportionate Impact on Less Affluent Regions

A coalition of children's charities, following a comprehensive analysis of government data, discovered that this policy has had an uneven impact on less affluent regions. The statistics reveal that 14% of children in the West Midlands and 13% in the North West are affected, in stark contrast to just 8% in the South East.

Driving Child Poverty

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Lynn Perry, Barnardo's CEO, underscored that the policy is a significant instigator of child poverty. Joseph Howes, Chair of the End Child Poverty Coalition, lambasted the policy for unjustly penalizing children. The policy results in families being £3,235 worse off for each additional child beyond the two-child limit, impacting 1.5 million children.

Contradicting the Rationale

Despite assertions that the policy would introduce fairness to working families, more than half of the households impacted comprise of working parents. Analysis conducted by the London School of Economics proposes that the policy's influence on birth rates is minimal, with a scant 5% decrease in additional births.

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Poverty Rates in the Midlands and the North

Poverty rates are notably higher in the Midlands and the north, with over a third of children living in poverty, as opposed to a quarter in the south-east. If the two-child limit were to be abolished, it could potentially elevate 250,000 children out of poverty at a cost of £1.3 billion. However, both the Conservative and Labour parties steadfastly stand by the policy.

Defending the Policy

The Department for Work and Pensions defends the policy, invoking the need for fairness and mentioning the safeguards in place for vulnerable individuals. But, with mounting evidence of its detrimental effects, the time might be ripe for a policy reassessment.

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