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Update two-child limit post with primary sources and yearly estimates (#2801)
* Update two-child limit post with primary sources and yearly estimates table
- Replace secondary news sources with primary research links
- Add specific years for all cost estimates
- Create appendix table comparing estimates across organizations
- Clarify IPPR estimate includes benefit cap removal
Fixes#2800
* Replace asterisk notation with proper markdown footnotes in appendix table
* Correct Resolution Foundation estimates and add full coverage row
- Fix Resolution Foundation 2029-30 estimate to £3.5bn (not £3.6bn)
- Add 'Full coverage' row showing £3.6bn estimates for both IFS and Resolution Foundation
- Add footnote explaining full coverage expected around 2035
* Fix to UK spelling: organization → organisation
* Clarify that poverty impacts use absolute before housing costs measure
* Move appendix after conclusion and clarify RF estimate is 'by' not 'in' 2029-30
* Remove unverified Resolution Foundation 2029-30 estimate
Only include verified RF estimates:
- £2.5bn in 2024-25
- £3.6bn at full coverage
* Correct IFS estimates based on October 2024 report
- Updated IFS estimate to £2.5bn in the long run for two-child limit removal alone
- Added note that £3.3bn would be the cost if household benefit cap also removed
- Removed incorrect £3.0-3.6bn range that wasn't in the actual IFS report
- Source: IFS October 2024 'Child poverty: trends and policy options' report
* Update two-child limit analysis with revised estimates
Update cost and poverty impact estimates across years 2025-2029:
- Costs: £2.7bn (2025) rising to £3.1bn (2029)
- Child poverty reduction: 13.6% (2025) to 15.5% (2029)
- Overall poverty reduction: 6.5% (2025) to 7.3% (2029)
Update appendix comparison table with new estimates for all years.
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* Update two-child limit analysis with revised estimates and proper citations
Updated cost and poverty impact estimates across years 2025-2029:
- Costs: £2.7bn (2025) rising to £3.1bn (2029)
- Child poverty reduction: 13.6% (2025) to 15.5% (2029)
- Overall poverty reduction: 6.5% (2025) to 7.3% (2029)
Fixed appendix to properly cite JRF (not IPPR) as source:
- Added JRF £2.7bn estimate for 2025/26 (two-child limit + benefit cap)
- Added JRF £2.8bn estimate for 2029/30 (two-child limit only)
- Included reference to JRF's earlier May 2025 estimates
- Updated sources to cite all three relevant JRF reports
- Removed misleading IPPR citation that was actually gambling tax revenue
Updated posts.json description to reflect 2026-27 numbers (£2.8bn, 15.7%).
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Co-Authored-By: Claude <noreply@anthropic.com>
* Fix Prettier formatting
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Co-Authored-By: Claude <noreply@anthropic.com>
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Co-authored-by: Claude <noreply@anthropic.com>
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@@ -87,16 +87,7 @@ At lower income ranges, the reform delivers larger increases in household net in
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## Budgetary impact
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PolicyEngine estimates that removing the two-child limit would cost £2.7 billion in 2026-27, rising to £3.0 billion by 2029-30. The cost increases over time as more children are born after April 2017, when the cap was introduced, making fewer families eligible for transitional protection.
The Institute for Fiscal Studies estimates the cost at [£3.4 billion](https://www.dailyrecord.co.uk/news/politics/rachel-reeves-decision-axe-two-35993258), while the Institute for Public Policy Research estimates [£3.2 billion](https://www.independent.co.uk/news/uk/politics/two-child-benefit-cap-bridget-phillipson-labour-b2836482.html) in 2026-27.
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PolicyEngine estimates that removing the two-child limit would cost £2.7 billion in 2025-26, rising to £3.1 billion by 2029-30. The cost increases over time as more children are born after April 2017, when the cap was introduced, making fewer families eligible for transitional protection. See the Appendix for a comparison of cost estimates from different organisations across years.
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## Distributional impact
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## Poverty impact
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By age group, removing the two-child limit would reduce poverty rates most for children across all years. The child poverty rate would fall by 16.2% in 2026-27 and by 16.4% in 2029-30, while the overall poverty rate would decline by 7.1% in 2026-27 and by 7.4% in 2029-30.
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By age group, removing the two-child limit would reduce poverty rates most for children across all years. Using the absolute poverty measure before housing costs, the child poverty rate would fall by 13.6% in 2025-26 and by 15.5% in 2029-30, while the overall poverty rate would decline by 6.5% in 2025-26 and by 7.3% in 2029-30.
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## Conclusion
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Removing the two-child benefit limit would cost £2.7 billion in 2026-27, rising to £3.0 billion by 2029-30. The reform would reduce child poverty by 16.2% and overall poverty by 7.1% in 2026-27.
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Removing the two-child benefit limit would cost £2.7 billion in 2025-26, rising to £3.1 billion by 2029-30. The reform would reduce absolute child poverty (before housing costs) by 13.6% and overall absolute poverty by 6.5% in 2025-26.
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We invite you to explore the [PolicyEngine webapp](https://policyengine.org/) to model your own customised reforms.
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## Appendix: Cost estimates by organisation and year
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The following table compares cost estimates for abolishing the two-child limit from different organisations.
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| Year | PolicyEngine | IFS | JRF | Resolution Foundation |
[^1]: JRF estimate includes both two-child limit and benefit cap removal. Source: JRF analysis using IPPR tax-benefit model (Parkes et al 2025). JRF's earlier estimate from May 2025 showed £2.0bn for two-child limit only in 2025/26
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[^2]: JRF estimate for two-child limit only. JRF's earlier estimate from May 2025 also showed £2.8bn for 2029/30
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[^3]: IFS estimate from October 2024 report "Child poverty: trends and policy options". Would cost £3.3bn if household benefit cap also removed
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[^4]: Full coverage expected around 2035 when all children potentially affected
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Sources:
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- PolicyEngine: This analysis
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- IFS: [The two-child limit: poverty, incentives and cost](https://ifs.org.uk/articles/two-child-limit-poverty-incentives-and-cost)
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- JRF: [Getting the child poverty strategy we need](https://www.ippr.org/articles/getting-the-child-poverty-strategy-we-need) (IPPR/JRF collaboration), [Two policies to boost family living standards and reduce child poverty](https://www.jrf.org.uk/child-poverty/two-policies-to-boost-family-living-standards-and-reduce-child-poverty), and [Three policies to reduce child poverty this parliament](https://www.jrf.org.uk/child-poverty/three-policies-to-reduce-child-poverty-this-parliament)
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