Historic legislation to scrap the two‑child limit on benefits has moved a step closer to becoming law, as ministers confirm a £1 billion Crisis and Resilience Fund designed to strengthen the safety net for families and help lift hundreds of thousands of children out of poverty.
The bill to end the two‑child limit has now reached second reading in Parliament, while local authorities across England prepare to deliver the new fund from April, marking the largest investment in local crisis support in a generation.
The Crisis and Resilience Fund will be distributed across local authorities throughout England and will replace the existing Household Support Fund, bringing together Discretionary Housing Payments into a single, streamlined grant.
For the first time, councils will receive a multi‑year settlement, ending the annual cliff‑edge funding cycle that has previously limited long‑term planning. Funding for the CRF has been confirmed until 31st March 2029, giving councils the certainty they need to design lasting, preventative support.
The government says the simplified structure will reduce administrative burdens while ensuring families can access help quickly when facing financial hardship.
By combining crisis support into one fund, the CRF is intended to act as a genuine safety net, allowing councils to develop long‑term initiatives tailored to local needs.
Guidance released alongside the funding sets out how councils can use the money, including:
- Joining up local services such as debt advice and financial support
- Helping families facing shortfalls in housing costs
- Delivering programmes to ensure children do not go hungry during school holidays
Dame Diana Johnson, Minister for Employment, commented:
“Families deserve support before a crisis hits, not after. By scrapping the two-child limit and launching a £1 billion Crisis and Resilience Fund, we’re giving councils the tools to help families build real financial security.
“Growing up in poverty has a significant impact on health, education and employment and lifting 550,000 children out of these circumstances isn’t just about fairness today, it’s about building a stronger Britain for the future.”
The guidance has been co‑designed with councils and charities, and provisional allocations have already been shared with every local authority.
The strategy also includes expanded free school meals and increased free childcare hours, aiming to break the cycle of poverty that leads to poorer health, education and employment outcomes.
Alongside reforms to benefits and crisis support, the government says it is taking further action to ease the cost of living, including increasing the National Living Wage, cutting an average £150 from household energy bills, and freezing rail fares and prescription charges.
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