Relief for some of Britain’s poorest lands at right moment to cushion Iran aftershocks | Heather Stewart

Timely end of two-child limit plus a healthy uptick in universal credit signals ‘life-changing’ boost to Britons most exposed to Trumpflation

It doesn’t involve warships, drones or strategic oil stocks, but one of Labour’s most potent weapons for containing the economic aftershocks from the Iran war for the UK is about to be unleashed: the scrapping of the two-child limit.

If the cost of essential goods spikes as a result of high oil prices it is the poorest households who will be the most exposed.

The timing is purely fortuitous, but ministers are about to write to parents in more than half a million such homes to let them know they are likely to receive an average of £440 extra a month from April. These are families with three or more children, claiming universal credit.

“It’s massive,” says Alex Clegg, an economist at the Resolution Foundation thinktank. “The amounts of money for families with four or five children, it’s life-changing: it’s thousands of pounds a year, for people right at the bottom of the income distribution.”

An above-inflation, 6.2% increase in the standard allowance of universal credit this year will also help these and a much wider group of low-income households.

Resolution’s latest projections, drawn up after Rachel Reeves’s spring forecast, suggested 480,000 children should be lifted out of poverty in 2026, as a result of these changes.

A pessimist might point out that with a wave of war-fuelled price rises heading our way – “Trumpflation”, as the TUC rightly calls it – the additional cash won’t go as far as it might have done, and that is true.

The flipside is that the reinstatement of support scrapped by the Conservatives when the cruel two-child policy was introduced in 2017, could hardly come at a better moment.

“Having a strong safety net is really important for these families to be able to manage shocks – ensuring that they can still put food on the table for their kids,” says Sam Tims, lead analyst at the Joseph Rowntree Foundation.

The government’s impact assessment of the policy suggests that of the 2 million children living in households likely to benefit from the change by 2030, 600,000 live in “deep material poverty”. That’s a new definition introduced by Labour and means a family is unable to afford essentials such as heating, transport and three meals a day.

The policy would be the right one, regardless of timing. No decent society should allow its children to grow up without the basic necessities of life, and they shouldn’t be punished for being born into a family that can’t make ends meet.

As Prof Ashwin Kumar, director of research at the Institute for Public Policy Research says, there are more hard-headed arguments, too, because this is the workforce of the future.

“The reality is that teachers know what they have to deal with when children turn up at school not fed, not ready to learn,” he says. “And in the end, if you want to give the next generation a chance, then you can’t have a whole bunch of people be left behind because their families don’t have the money to look after them – which is an economic argument.”

Reeves highlighted this in her budget speech last year announcing the change, talking about “the future cost to our economy and to our society, of wasted talent and a welfare system that bears the cost of failure for decades to come”.

Protecting families from economic shocks was meant to be one aspect of the philosophy Reeves calls “securonomics”, which she will restate in her Mais lecture on Tuesday – though her rhetorical focus in power has tended to be more on fixing the public finances and building roads, railways and runways.

Mothers affected by the two-child limit recently told the charity Save the Children what they would spend the additional money on – and the weight it would lift from their shoulders.

“From now on I’ll be able to pay the bills and be able to stick that heating on a little extra for the children,” said Kim, from Ashton-under-Lyme, a mother of five whose partner works.

Thea, a working mother of three in London who has campaigned for the limit to be scrapped, said: “It could mean winter clothes, new shoes or a summer holiday club. But in the end all I want is to spend a weekend just playing with my kids, without stressing about money.”

Anti-poverty campaigners are now taking aim at the overall benefit cap, which limits the total households can claim; and the fact that local housing allowance has been frozen, causing the support level to fall ever further behind rental costs.

As calls for the government to be prepared to act over energy bills grow, Reeves is right that households already struggling must be her priority. So it is fortunate that while officials prepare for weeks of wrangling over the details of any support scheme, some of the UK’s poorest families are already about to receive a helping hand.