Starmer's Cap Crisis at Conference: Poverty Rift Looms Despite £150 Energy Relief

Prime Minister Keir Starmer's government is walking a tightrope on poverty policy as the Labour Party prepares to convene its annual conference in Liverpool. The government is highlighting a major expansion of the Warm Home Discount (WHD) scheme, which will provide a much-needed £150 energy bill rebate to a record six million low-income households this winter. Yet, this positive announcement is overshadowed by intense pressure from within his own party and from education unions to abolish the controversial two-child benefit cap.

Expanded Energy Lifeline for Six Million

The extension of the Warm Home Discount, which was confirmed by Sir Keir Starmer, will effectively double the number of eligible households receiving a £150 discount on their electricity bills this winter. The expansion removes the restrictive 'high energy costs' criteria for those on means-tested benefits, meaning a broader group of people—including those on Universal Credit, Housing Benefit, and Employment and Support Allowance—will now qualify. Pensioners on low incomes receiving Guarantee Credit will also continue to benefit.

The one-off £150 discount will be applied directly to energy bills between November 2025 and March 31, 2026, with the majority of customers expected to receive the support before the end of January, providing a crucial lifeline as energy prices are set to rise by 2% from October 1st. Prime Minister Starmer has championed this move as making a "big difference" to families struggling with the rising cost of living.

Internal Rebellion Over Two-Child Benefit Cap

Despite the move on energy bills, a significant internal rift has opened up over the two-child benefit cap, a Conservative-era policy that restricts benefit claims to a family's first two children. As Sir Keir heads to the conference, he faces open calls from backbench Labour MPs, including recently sacked minister Lucy Powell, and a collective of influential education unions—such as the NAHT, ASCL, and NEU—to scrap the cap immediately.

Critics argue the policy is a major driver of child poverty, with one letter to the Prime Minister stating it is "harming the lives of hundreds of thousands of children." The pressure has intensified with reports that the government's own child poverty taskforce is set to recommend abolishing the cap as the most effective single measure to lift children out of poverty.

While Sir Keir has acknowledged his clear intent to "bring down child poverty" and confirmed that a taskforce report is forthcoming, he has stopped short of committing to axing the cap, which a future Conservative shadow cabinet has vowed to quickly reinstate if scrapped. The debate over this "poverty-producing policy" is set to dominate the Labour conference, forcing the Prime Minister to confront a moral and political challenge from within his own ranks over the future of the UK's welfare system.