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How Scotland Mitigates the Effects of the UK’s Two Child Benefit Cap

John Swinney helping a child with her letters

As First Minister of Scotland John Swinney pledged to eradicate child poverty. The latest figures released show that the Scottish Child Payment, unique to Scotland, is supporting 329,000 children in the country with over £677 million paid since the payment launched.

The payment was introduced to limit the effects of UK Government policies like the 2-child benefit cap, aka ‘The Rape Clause’. The Rape Clause, or the two-child benefit cap, prevents parents from claiming child tax credit or universal credit for more than two children. There are limited exceptions to the cap one of which is the requirement for mothers to prove the child was the result of a sexual assault, or rape, hence the name.

The benefit cap was first announced during the Conservative/LibDem Coalition Government in 2013. The policy was then successfully introduced by the Conservative Government in 2017. Keir Starmer, Leader of the Labour Party has confirmed that he would keep the two child benefit cap.

In April 2023, the two-child limit affected 422,000 (55%) of the 772,000 families  in the UK with three or more children claiming Universal Credit or Child Tax Credit. 22,000 households had an exception.

Around 371,000 (88%) of UC (Universal Credit) and CTC (Child Tax Credit)  households affected by the policy were residents in England in April 2023. 25,000 (6%) were residents in Scotland and 20,000 (5%) in Wales. Around 5,000 (5% of CTC) were CTC recipients in Northern Ireland. A small number of CTC claimants (less than 1,000) were either resident abroad or their country could not be identified from the data.

Data provided by the End Child Poverty Coalition shows that removing the cap would lift 250,000 children across the UK out of poverty.

Action taken by the Scottish Government

In Scotland the Scottish Child Payment is part of a wider package of payments funded by the Scottish Government – including the three Best Start Grants and Best Start Foods – which together have provided over £829 million in vital financial support at key stages of a child’s life. There is no cap on the number of children in one family who can receive these payments.

Families and carers in Scotland can apply for the Scottish Child Payment by clicking this link at mygov.scot/scottishchildpayment or by calling Social Security Scotland free on 0800 182 2222 

For the Scottish Child Payment applications across the whole of Scotland were made. As at 31st March 2024, 790 children in Orkney are being supported by the payment.

The number of children in Scotland requiring this payment has increased significantly since its introduction.

Number of Children Actively Benefitting from Scottish Child Payment on 31 March 2024 (Child Caseload)

Commenting on the figures for Orkney Highlands and Islands SNP MSP Emma Roddick said:

“Young people in Orkney have been seriously impacted by the austerity policies of the UK Government. The SNP Government is doing what we can, with the limited devolved powers we have, to lift children out of poverty. This is the right thing to do.

“I am comforted to see the new figures that show so many children in Orkney are benefitting from the Scottish Child Payment. With a cost-of-living crisis caused by the UK Government and the disastrous implications from Brexit, the Scottish Child Payment clearly demonstrates the SNP Government’s support for families in this region. The Scottish Child Payment is making a difference to those who need it the most and is lifting children out of poverty right now.”

A three year study published last year into the impact of the Two child Benefit Cap in the UK found an “unassailable case for the need to end both the two-child limit and the benefit cap, and to centre support for families with children in a much more positive light within the social security system.”

“we estimate that 32,000 households containing 110,000 children were subject to both the benefit cap and the two-child limit in March 2022.”

You can find a download of that report at the end of this article.

Scottish Child Payment

Scottish Child Payment is a benefit which has been introduced to tackle child poverty in Scotland. It is intended to help low-income families with the costs of raising a child and is available to parents or carers with one or more children under the age of sixteen.

There are no limits on the number of eligible children supported by Scottish Child Payment and since 14th November 2022 eligible families receive £25 per child, per week. Between April 2022 and 13th November 2022 the rate was £20 per child per week and before that the rate was £10 per child, per week. Scottish Child Payment was increased to £26.70 in April 2024, in line with inflation.

Scottish Child Payment is administered by Social Security Scotland through an application-based process, and is paid on a four-weekly basis. Scottish Child Payment does not count as earned income in the calculation of any other UK or Scottish Government benefits that the applicant, or any person in their household, currently receive.

The payment can be used for any purpose by the recipient and for example could help with the cost of childcare, nappies, activities or other essentials.

Social Security Scotland delivers five family payments to help support costs of raising a family for eligible people getting Universal Credit, tax credits or other qualifying benefits.

Scottish Child Payment: a payment of more than £100 every 4 weeks for each eligible child under the age of 16. 

Best Start Grant Pregnancy and Baby Payment: a £754.65 payment for a first child and £377.35 for other children. People can apply from the end of the 24th week of pregnancy until your baby is 6 months old. 

Best Start Grant Early Learning Payment: a £314.45 payment when a child is between the ages of 2 and 3.5 years. People can still get the payment if your child is not taking up a place at nursery. 

Best Start Grant School Age Payment: a £314.45 payment when a child is first old enough to start school. People don’t need to take up a place at school to get the payment.   

Best Start Foods: money every 4 weeks on a pre-paid card from pregnancy until a child is 3 years old.

Social Justice Secretary in the Scottish Government Shirley-Anne Somerville said: 

“As the First Minister has set out, eradicating child poverty is the number one priority for the Scottish Government.

“Scottish Child Payment plays a key part in that mission. Together with our Best Start Grant and Best Start Foods payments, this package of financial support, which is worth almost £25,000 per child by the time their child turns 16, is helping to make sure all children in Scotland get the best start in life.

“We have provided over £829 million to help people raise their families, putting money into the pockets of people who need it most.

“This crucial cash is available as soon expectant parents know they are pregnant all the way through to their child starting nursery, then going to primary and secondary school and helps them cover costs of caring for their children.

“We know from our recent research that families say the application process is clear and doesn’t take too long to apply. So I would urge families to apply for our package of five family payments and get the money they are entitled to.”

Fiona Grahame

Photo by chantika febriani on Pexels.com

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