Martin Lewis explains capping two-child benefits as Coventry MP suspended over vote

MoneySavingExpert.com guru Martin Lewis has taken it upon himself to clarify the intricacies of the two-child benefit cap – acknowledging that there is a considerable amount of confusion surrounding it.

He took to X, formerly known as Twitter, to clear up any misunderstandings with a clear and straightforward video explainer detailing the ins and outs of the Child Benefit guidelines, the two-child limit on Universal Credit and the benefit cap. Its purpose was to clarify the situation and correct any inaccurate assumptions.

It comes as Coventry South MP Zarah Sultana is among a number of Labor MPs suspended after rebelling against the party in a vote to overturn the policy. The defiant MP said she “slept well” after making the decision, telling ITV’s Good Morning Britain that 10,000 children in her constituency – one in three – live in poverty.

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Mr Lewis wrote on the social platform, asking: ‘Confused about the difference between the child benefit rules, the limit of two child benefits and the benefit cap? I wouldn’t be surprised if you are, as it was very confusing.”

He pointed out that these terms are often mistakenly grouped under the “double child benefit cap” – a term he says “doesn’t really exist”.

Further in his message, he stated that: “I want to try to clear things up for you. Although I have to start by saying that I will be looking at the big picture here. The benefits system is very complicated, there are a lot of ifs and buts, I won’t go through them all, it’s just to try and give you the broad brush concept.”, the Mirror reports.

He offered more insight into the specifics, elucidating: “So the first thing is Child Benefit, a universal payment made for every child you have. You get £25.60 per week for the first child, £16.95 per week for each subsequent child. So To be clear, you have 10 children, that’s one lot at £25.60 a week and nine lots at £16.95 a week.”

He explained: “Although this is subject to the benefit cap which I will talk about later. In addition, there is another restriction on child benefit, which depends on what the highest-earning parent earns. So once they earn £60,000 or more, then child benefit is clawed back through the tax system by what’s called the High Income Child Benefit Levy.”

“If that income is over £80,000 then that tax is the same as child benefit. So effectively you don’t get any child benefit. The way it’s structured is unfair to single parents, single-earner families and mainstream income families, and that’s something I’m campaigning on separately, but that’s not what I’m going to talk about today.”

Moving on, he reached the two-child limit, which he notes is currently a hot topic in the media and at the center of political debate.

He went on to say: “It should be accurately called the ‘two-child limit for universal credit or tax credits’. This applies to benefits that people on low incomes receive, regardless of whether they work or not. That’s what it’s all about and in simple terms it means if you have more than two children then you don’t get any extra benefit for the costs they incur for universal credit and tax credits.”

“There are exceptions to this. If your baby was born before 6th April 2017 when he came then that doesn’t matter and there are other things out there. For example, if you’ve had multiple birth triplets, then there are exceptions in the rules for that, but generally more than two children, you won’t get extra benefits.”

His third and final topic revolves around the benefit cap which “in simple terms” is said to be “the maximum amount you can get out of benefits”.

He continued: “Now, there are rules here, like a nine-month grace period, which means some can get more. But in general terms, it is a maximum amount. Now, crucially, this includes universal credit and tax credits, but it also includes children. benefits and a whole host of other benefits, post other benefits.”

“So check online. There is a full list on gov.uk of which benefits are included. The cap for families, couples and lone parents is £1,835 per month, for single adults it is £1,229.42 per month unless you live in Greater London when the caps are all higher.”

“So there you go, you have child benefit rules, the two-child limit for universal credit and tax credits, and a cap on benefits. This is how the system works. While there are a lot of ifs and buts, I hope this helped clear things up. it rises a little.”

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