Farage puts pints over poverty with plan to cut price of beer by reinstating two-child benefit cap

Nigel Farage has been accused of choosing pints over poverty as he unveiled a £3 billion plan to slash the cost of beer by reinstating the two-child limit on benefits.

As Labour’s bill to remove the two-child limit progressed through the House of Commons on Tuesday (3 February), the Reform UK leader laid out his plan to boost Britain’s ailing hospitality sector while plunging 450,000 children back into poverty.

Farage’s five-point plan includes cutting beer duty by 10% which, if landlords passed on the cut, could see the price of pints fall by 5p, according to Reform calculations.

Business rates for pubs – which Labour chancellor Rachel Reeves announced a 15% cut and two-year freeze for recently – would be abolished for four years, Reform said, while VAT would be reduced to 10% for the hospitality sector. National insurance hikes would also be scrapped for pubs.

Reform said the package would cost £2.29bn in its first year, rising to £2.9bn in the fourth year. Farage estimated the package would take £1 off the cost of a pint within two to three years.

But, controversially, the plan would be paid for by reintroducing the two-child limit after Labour axe it – except for people who are “British and work full-time”.

Announcing the plan, Farage said: “What is happening to our pubs, what is happening to our hospitality sector is little short of a disaster. They’re on the edge of falling off a cliff. It’s serious, very, very serious.”

He added: “Yes, it means getting rid of the proposed legislation from Labour on the two-child benefit cap. It is reducing the benefits bill in favour of encouraging private enterprise and jobs and wealth creation.”

Farage’s stance on the two-child limit has changed since as recently as last summer when he backed calls for it to be scrapped.

His U-turn has attracted criticism from Labour MPs.

Connor Naismith, Labour MP for Crewe and Nantwich, tweeted: “The cost of 5p off a pint for Reform UK? Plunging half a million kids (and counting) into poverty.”

Another Labour MP, former Resolution Foundation think tank boss, Torsten Bell, added: “Couldn’t make this up. Farage: WAS calling for the two child limit to be scrapped. NOW calling for the two child limit to be reinstated 

“Reform aren’t just importing failed Tory politicians. They’re importing failed Tory policies.”

Henry Parkes, principal economist at think IPPR, told Big Issue that Reform’s proposals are likely to cost more than the party suggests.

“Pushing half a million children into poverty to fund a suite of hospitality tax cuts – cutting VAT, beer duty, business rates and national insurance – is indefensible,” said Parkes.

“It also just doesn’t add up – with these tax giveaways likely to cost far in excess of the savings from re-instating the two-child limit.”

JRF chief analyst Peter Matejic said scrapping the two-child limit on benefits can bring its own economic advantages.

“IInvesting in social security can also help the economy. Money spent on social security does not just evaporate, it is spent on the everyday essentials we all need,” said Matejic.

“We also think it’s a moral choice because it will boost the health and education outcomes of two million children who would have been hit by the limit in 2029-30. 

“All told scrapping the two-child-limit is an important first step in tackling the legacy of deepening poverty that has built up over the past three decades.”

George Bangham, head of social policy at the New Economics Foundation, insisted that helping pub landlords and children in poverty shouldn’t be pitted against each other. 

“It shouldn’t be an either or between helping the businesses that are the beating heart of our high streets and lifting children out of poverty,” said Bangham.

“The right way to support pubs and the high street through tough times is to cut their taxes for by getting rentier landlords and landowners to pay their fair share instead.”

Reform’s plan comes as hospitality bosses and pub landlords have pleaded for help, following news that nearly 400 pubs closed their doors last year.

Former Greater Manchester night time economy adviser Sacha Lord said on X: “We now have The Tories, Lib Dems and Reform listening more to the sector than the current Labour government.

“Hospitality should be at the heart of any Labour government offer. Ministers really need to pull their fingers out and act.

“The sector won’t survive until the next general election.”

Kate Nicholls, chair of UKHospitality, added: “Hospitality has the highest tax burden of any sector in the economy and it is leading to job losses and business closures.

“There is an urgent need to reduce the cost of doing business, particularly across taxation, business rates and employment, and we urge every party to work with us on their plans to achieve this, whether in government or opposition.”

Farage’s bid to pitch the hospitality sector crisis against poverty busting plans comes as MPs debated Tuesday’s second reading of the Universal Credit (Removal of Two Child Limit) Bill in the Commons for the first time.

Labour finally caved into pleas from anti-poverty organisations, including the Big Issue, to announce that the two-child limit would be axed at last November’s autumn budget.

The move is expected to deliver the biggest reduction in child poverty in a single parliament on record, taking 450,000 children out of poverty by 2029.

As MPs scrutinised the legislation, Big Issue backed a joint-statement from the Child Poverty Action Group and 65 other charities and other organisations including Citizens Advice, Save The Children UK and Trussell,  calling for MPs to take action to reduce child poverty.

Read more:

• Is the £10 pint nearly here? Why drinks prices are going up
• What does the end to the two-child limit on benefits mean for you?
• Everything you need to know about Labour’s child poverty strategy

“This is a historic day for children and families across the UK as legislation to remove the two-child limit from our social security system starts to make its way through parliament,” the statement said.

“The two-child limit was an awful experiment that hurt children. More than any other policy, the two-child limit is responsible for driving child poverty to its current record high.

“Poverty has a devastating impact on young lives. Children going without things they need to learn and grow, living in damp homes, struggling at school, facing isolation and stress. 

“Today marks the moment when we start to turn things around for the next generation. We commend the government for making the choice to scrap the two-child limit and ask all MPs to stand with children and support this bill.

“Every child deserves the best start in life, with a decent childhood that lays the foundations for a strong future. Ending the two-child limit sets our country on the right path to meet that ambition.”

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