Single mother Tracey Morris picked up an extra £600 for her youngest children Luna and Harlie today — the first payment under Britain's newly scrapped two-child benefit cap. Across the UK, 480,000 families with three or more children are now receiving an average of £4,100 more per year in universal credit payments.
Morris, who lives in Huddersfield with her five children aged six to 19, works full-time for the local council and picks up extra pub shifts to make ends meet. The two-child cap had prevented her from claiming universal credit for Luna and Harlie, born after the policy was introduced in 2017.
"I've always had to be careful what I spend and how I spend it. The cost of living got so high, it's a struggle," Morris told the BBC. She depends on a local food pantry called The Bread and Butter Thing to buy basic groceries. "It's so draining. I'm exhausted worrying about money all the time."
The policy change automatically increases payments from May onwards — eligible parents don't need to apply. Morris will receive just under £300 extra each month for each of her three affected children.
The benefit increases come alongside a broader package of changes to the UK's welfare system. About three million families will receive an average increase of £120 this year through adjustments to the basic universal credit allowance paid to all claimants.
Other disability and carer benefits are rising by 3.8% in line with inflation. The state pension is increasing by 4.8% under the triple-lock mechanism, bringing the new flat-rate pension to £241.30 per week (£12,547.60 annually) — an increase of £574.60 for those who reached pension age after April 2016.
However, not all changes favor claimants. The health element of universal credit, paid to people whose disabilities restrict their ability to work, is being halved for new applicants. Existing claimants remain protected from the cut.
The timing coincides with frozen income tax thresholds that push more workers into higher tax brackets as wages rise — a policy critics call a "stealth tax." The Conservatives initially froze thresholds until 2028-29, but Labour extended the freeze until 2031 in November.
- Two-child benefit cap scrapped for 480,000 families
- Basic universal credit allowance increased for 3 million families
- Disability and carer benefits rise 3.8% with inflation
- State pension increases 4.8% under triple-lock
- Health element of universal credit halved for new claimants
For Morris, the change represents immediate relief from financial stress that has dominated her daily life. "As a mum, sometimes you feel like you're failing, but I'm not failing, it's just the situation, unfortunately, that we are in," she said.
Charities have described the policy reversal as a "gamechanger" for families struggling with rising living costs. The change affects working families disproportionately — 59% of households gaining additional support are in employment, like Morris.
