Labour not pledging to scrap two-child benefit cap as policies must be ‘fully costed’, says Rachel Reeves

However, the shadow chancellor said the party will carry out a ‘fundamental review’ of Universal Credit

Labour has not committed to scrapping the two-child benefit cap because the party will not make financial promises it can't keep in the face of a dire economic climate, Rachel Reeves has said.

The shadow chancellor said everything in Labour’s manifesto would be “fully costed and fully funded”, adding: "And that means that there are things that we would like to do that we're not going to be able to do as quickly as we would want.”

However, she said there would be a “fundamental review of how Universal Credit works across a whole range of areas”.

Rachel Reeves. Picture: Christopher Furlong/Getty Images

The two-child cap – dubbed by some as the “rape clause” – precludes families from applying for child tax credit and Universal Credit for more than two children, although an exemption exists if a child is conceived through rape and this can be proven. The policy has proven hugely controversial.

On Thursday, Labour leader Sir Keir Starmer said scrapping the two-child limit was not party policy, but he did not rule out a shift at a later date, adding: “If that changes, I’ll let you know.”

This provoked anger among some in Labour, with MSP Monica Lennon tweeting: “I know colleagues are scared of deselection, being exiled to backbenches or not winning selections, but if we don’t speak out, then who will? The two-child benefit cap (aka the rape clause) is abhorrent and must be scrapped.”

Speaking to journalists during a visit to the Scottish Gas Academy in Hamilton, Ms Reeves said Labour voted against the two-child limit. She said: “We recognise as well the huge struggles that families are facing at the moment. It's why we've said that we would extend the windfall tax to help people with the cost of living now.

"It's also why Jonathan Ashworth, our shadow work and pensions secretary, has committed to a fundamental review of how Universal Credit works across a whole range of areas, because this is not the only area where people have concerns about how Universal Credit is working."

Ms Reeves said everything in Labour's manifesto would be "fully costed and fully funded", adding: "We are going to inherit, if we win the next election, probably the worst economic inheritance that any government has ever been bequeathed by its predecessor. And that means that there are things that we would like to do that we're not going to be able to do as quickly as we would want. I'm determined that we have a fully costed and fully funded manifesto, and that I don't make any promises that we can't keep.

"But that manifesto period is still a way off, and we will set out that manifesto closer to the election."

Ms Reeves said it was very important that all of Labour's policies and actions were "built on a rock of economic and fiscal stability". She said: "All of our policies that we've set out are fully costed and fully funded. This is not one that we've set out. But we have committed to that review of Universal Credit across a whole range of areas."