A raft of changes to state pensions, benefits and employment law took effect on 6 April, marking one of the most significant single-day shifts in household finances for years.
What Changed on 6 April — and Who Benefits Most
The scrapping of the two-child benefit cap stands as perhaps the most politically consequential measure to come into force. After sustained pressure from Labour backbenchers and anti-poverty campaigners in the months before last November’s budget, Chancellor Rachel Reeves confirmed the policy would be abolished.
From today, eligible parents claiming Universal Credit can receive the child-related element for all their children, removing the restriction that had limited payments to the first two. The monthly rate stands at £303.94 for any child born after 6 April 2017, while families whose first child arrived before that date can claim £351.88 per month. For an eligible household with three children all born after April 2017, that amounts to £911.82 a month — roughly £3,647 per child annually.
The fiscal cost is considerable. According to the Office for Budget Responsibility, removing the cap will cost £2.3bn in 2026-27, rising to £3bn by the end of the decade. That figure includes an estimated £300m to cover around 25,000 additional families expected to make new Universal Credit claims as a result of increased eligibility.
Why the Cap’s Removal Carries Such Political Weight
The two-child limit had become a lightning rod for criticism from child poverty organisations. Research by the Child Poverty Action Group found 109 children were being pulled into poverty each day as a direct consequence of the cap, compounding the situation of the 4.8 million children already living below the poverty line. Campaigners estimated that abolition could lift 350,000 children out of poverty outright, while reducing the depth of poverty for a further 800,000. Under the official measure, a household is considered in relative poverty if its income falls below 60 per cent of the median after housing costs.
Pensions, Universal Credit and the Broader Uplift
Alongside the benefit cap changes, millions of state pension recipients saw their payments rise by 4.8 per cent under the triple lock guarantee — a figure based on average earnings growth recorded in July, and one that outstrips inflation. The full new state pension now stands at £241.30 a week, up from £230.25, while the basic old state pension has risen to £184.90 from £176.45. To qualify for the full amount, claimants must have accumulated 35 years of national insurance contributions.
Universal Credit rates have also increased. Single claimants aged 25 and over now receive £424.90 a month, up from £400.14, while joint claimants in the same age bracket receive £666.97. Child benefit — a universal payment available to anyone responsible for a child — has risen to £27.05 a week for the eldest or only child. A high-income charge continues to apply where a claimant or their partner has an adjusted net income above £60,000.
Inflation-linked benefits rose by 3.8 per cent, with others receiving a 2.3 per cent increase.
The Workplace Reforms Taking Effect Alongside the Financial Changes
The financial measures arrived in tandem with a sweeping set of employment law reforms under the Employment Rights Act 2025, which is being phased in across this year and next.
Among the most notable provisions now in force is the removal of the three-day waiting period and minimum earnings threshold for statutory sick pay, a change designed to extend eligibility to low-income and irregular-hours workers. Employees also now enjoy day-one entitlement to paternity leave and unpaid parental leave — rights that previously required 26 weeks of service. London Mayor Warns Labour Council Losses Risk Investment Cuts
A new category of leave has been introduced for bereaved partners following the death of a child’s mother or primary adopter within the first year of the child’s life. Protections around collective redundancy have been strengthened, whistleblowing safeguards for workers reporting sexual harassment have been bolstered, and a new Fair Work Agency has been established to uphold workers’ rights and support employer compliance.
Employers are now also required to retain holiday pay records for six years, while those with 250 or more staff are being encouraged to publish action plans addressing their gender pay gap and support for employees experiencing menopause.
Further reforms remain on the horizon. Changes to unfair dismissal protections are scheduled for 1 January 2027, with additional measures covering trade union legislation and workplace harassment protections expected across 2026 and 2027.
