Budget Resolutions

First, then, I want to talk about fair choices. An illuminating chart—I love charts—on page 33 of the Budget Red Book shows the impact of decisions since the 2024 autumn Budget. It shows the progressive approach of my right hon. Friend the Chancellor. It shows that every decile will be better off as a result of her measures, except the richest 10%, with the greatest gains as a percentage of income to lower and middle-income families. That includes raising the national living wage and the national minimum wage, freezing rail fares for the first time in 30 years and freezing prescription charges, as well as two measures I want to focus on.

The first measure is lifting the two-child limit in universal credit, which goes to the heart of the affordability crisis that so many face. I think we need to have a debate about this issue. According to a Department for Work and Pensions document published on the day of the Budget, since its introduction in 2017, the two-child cap has put 300,000 children into relative poverty. That is the equivalent, as the document says, of 100 children every single day—more than three primary school classes each day being pushed into poverty. It is also part of a wider picture. According to the Joseph Rowntree Foundation, 7.1 million low-income households—one in four across the UK—have gone without essentials in the last six months, in one of the richest countries in the world. That is why we have acted on the two-child limit. Two million children will be helped, and 450,000 fewer children will be in poverty by the end of the Parliament.

As I understand it, the Conservatives oppose the policy change because they claim it is about helping people out of work who are undeserving. We need to unpack this false claim. The inescapable fact that the Opposition want to run away from is that around 60% of families impacted by this policy are in work, not out of work. These are people for whom work simply does not pay, like in the case—highlighted by the Child Poverty Action Group—of Shauna and her husband, who have three children. Shauna’s husband works full time and she says,

“This will make a big difference because we’ve had to incur debts. Hopefully it will mean I can cover the last bills that come in each month instead of being in the red. I could buy a new mattress for two of my children. They can feel the springs on the mattresses they’ve got that they’ve had for many years.”

That is the condition-of-Britain question.

How does the Leader of the Opposition describe Shauna and her husband? She calls them “Benefits Street”. These are people working all the hours God sends, working hard, trying to do the right thing: the very people the Conservatives claim to stand up for. How dare she!