Britain's benefits bill set to soar

TAXPAYERS will be funding a £406billion benefits bonanza in five years' time after Rachel Reeves axed the two-child benefit cap yesterday.

- BY JONATHAN WALKER Whitehall Editor

The Chancellor insisted her decision would prevent children waking up cold or going to school hungry.

In an announcement greeted by cheers from Labour MPs, she told the House of Commons: "I don't intend to preside over a status quo that punishes children for the circumstances of their birth. We are lifting 450,000 children out of poverty with the end of the two-child limit."

But the move will help ensure that welfare consumes an even bigger proportion of the nation's wealth.

Benefits will cost Britain 11.2% of GDP in 2030-31, according to the Office for Budget Responsibility - up from the current 10.9%.

The two-child cap introduced by the Conservatives meant parents could usually only claim Universal Credit for their first two children.

Ending the cap will mean an estimated 560,000 families will enjoy an average £5,310 per year more in Universal Credit payments.

Spending

It will cost £3bn by 2029-30 and comes on top of the £7bn cost, in the same time frame, of reversing cuts to winter fuel payments and scrapping limits to health-related benefits.