This year’s Labour Party conference is unlikely to go smoothly for the Government. As delegates descend on Liverpool on Sunday, anger has already been mounting over the its inaction on the two-child benefit cap. Though the noise from No 10 have been clear that it remains the government’s intention to lift it, no timeline has been forthcoming.
Labour insiders have suggested it is “a dead cert” the government will announce the lifting of the cap as the conference’s policy headline, while others have said No 10 may yet hold off owing to the UK’s rocky fiscal outlook. But considering the unpopularity of this policy among Labour members and growing criticism of the Prime Minister and his performance, could the Government’s hand be forced this weekend?
Disgruntled MPs and Labour members are already organising to get rid of the cap. The policy – which was first introduced by the former Conservative chancellor, George Osborne – limits benefits to the first two children in a family, affecting around 1.7 million children across the UK. Abolishing the cap is projected to cost the Exchequer around £3.5bn a year; but a growing consensus holds that sticking with the policy contravenes Labour values. If the cap is lifted, an estimated 470,000 children would be lifted out of poverty.
An attempt to debate the abolition of the cap on the conference floor brought by the Andy Burnham-backed caucus, Mainstream, was blocked by the leadership’s Conference Arrangements Committee (CAC) last week. But following an appeal, it could now happen. Earlier this week, Burnham himself came out against the policy, describing it as the “worst of Westminster”. His intervention was made all the more salient by speculation this week that he is eying up a return to Parliament following an in-depth interview with the New Statesman.
Though the party leadership is clearly hesitant to allow delegates, MPs and members the chance to debate the cap, some Cabinet ministers have already come out against the policy. In the week leading up to the conference, Starmer was urged by the Child Poverty Taskforce (a group of senior officials and ministers) to lift it. The taskforce, which was set up shortly after Labour entered government, was supposed to report in spring 2025, but was delayed after renewed pressure was put on the Prime Minister over the policy (the Government said the delay would allow those in the taskforce to work out how removing the cap might be paid for). The recommendations are now expected ahead of the November budget.
The candidates vying to become Starmer’s deputy leader have also come out against the cap. Last week, Bridget Phillipson, the Government’s preferred candidate and Education Secretary, described the cap as “spiteful”. She said abolishing the policy was “on the table” in the most explicit sign yet that the cap could soon be lifted. Lucy Powell, who some have speculated is a proxy candidate for Burnham, has also advocated for its removal. She described the policy as a “ticking time bomb that we need to scrap” and proposed paying for the deficit it would leave by placing a tax on gambling companies, a policy advocated by former Labour prime minister Gordon Brown in his guest edit of the New Statesman earlier this year. In the week leading up to conference, more than 101 MPs signed a letter to Rachel Reeves which set out the “compelling” case for a targeted levy on online gambling products. A win for Powell at the end of October would certainly throw legitimacy behind this proposed set of policies.
Still, this isn’t the first time that pressure has mounted on the government over the two-child cap. In July 2024, shortly after they were elected, Labour suspended seven MPs for voting for an SNP amendment to the King’s Speech which would have abolished the policy. They included Richard Burgon, Ian Byrne, Imran Hussain, John McDonnell, Rebecca Long-Bailey, Zarah Sultana and Apsana Begum. (McDonnell and Begum had the whip reinstated on Friday evening; Sultana has left Labour to found a new left-wing party.)
These MPs are furious with the Prime Minister. They feel shortchanged after being punished for calling for a policy to which No 10 may now be poised to commit. And considering more MPs have since been suspended for voting for anti-poverty measures, their patience with this Labour leadership is clearly growing thin. “The Prime Minister’s first year in office has been politically disastrous,” Burgon told me. “The Government [are] seen as too close to the rich and powerful while punishing the most vulnerable through cuts to disability support and the winter fuel fiasco.”
He said this issue “will loom large over conference” as Labour members and voters are “desperate for a change in direction with real action against poverty.” Burgon added: “They want to see this government embracing real Labour values.” This, he said, is the only way to stop Nigel Farage entering No 10. “The Prime Minister’s willingness to scrap the cruel two-child policy will be a big test of whether he is capable of doing that.”
The government’s reason for equivocating over the two-child benefit cap has always been the cost. But now, with pressure mounting across the conference floor and even inside Starmer’s own Cabinet, this is an issue which is unlikely to subside at this year’s conference. A Gambling Levy is seen by many on the left as the most obvious way to achieve this goal. Labour members’ patience is already wearing thin with the party leadership. Cutting the two-child benefit cap and upholding those “real Labour values” is one way of keeping them on side.
[Further reading: Labour vs the left]
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