In a significant pre-Budget leak, the Office for Budget Responsibility (OBR) has confirmed the government will scrap the controversial two-child benefit cap from next April.
The OBR's report was published prematurely due to a technical error today, November 26, revealing key details hours before Chancellor Rachel Reeves was scheduled to deliver her Budget statement to the Commons.
What the leaked report reveals
The accidentally released document states unequivocally that the two-child limit on benefits will be removed starting April 2026.
This policy change, which restricts support through the Universal Credit child element to the first two children in a family, has been the subject of intense political debate and campaigning by poverty charities.
The OBR's analysis provides the first official cost assessment, revealing the move will cost £2.3 billion in the 2026-27 financial year, rising to £3.0 billion by 2029-30.
Financial impact and projected uptake
The budget watchdog's report breaks down the substantial financial implications of ending the cap.
It notes that approximately £300 million of the total cost by 2029-30 will come from supporting an estimated 25,000 additional families who are expected to claim Universal Credit due to the increased generosity of the benefits system.
The child element currently stands at £3,500 per year for each child, meaning larger families stand to gain significantly from the policy reversal.
Broader context and reaction
The early publication caused considerable disruption to the Treasury's carefully orchestrated Budget day, with the OBR issuing an apology and launching an investigation into the technical failure.
The document was not intended for public release until approximately 1:30 pm, after the Chancellor's Commons address.
Anti-poverty campaigners have long argued that removing the cap is essential to lift millions of children out of poverty, while the government had faced mounting pressure to address the issue.
The leaked report also revealed other Budget measures including frozen income tax thresholds for three more years and the introduction of a new mansion tax.
The OBR has stated it is investigating the circumstances that led to the premature publication of its sensitive economic forecast.
