The Prime Minister’s Office has introduced a package of cost of living measures from 5 April 2026, led by Keir Starmer, including scrapping the two-child benefit cap and increasing State Pensions by 4.8% for more than 12 million people. The measures also include benefit uprating and expanded worker protections aimed at supporting households across the UK.
Introduction
The measures apply across the UK and were announced as part of a wider government response to rising household costs. They include changes to benefits, pensions, and employment rights affecting workers, pensioners, and families.
The package also aligns with recent adjustments to wages and energy costs, forming a coordinated set of actions introduced in early April 2026. The changes are designed to provide direct financial support while addressing broader economic pressures.
Cost of living measures
The measures introduced on 5 April 2026 bring together changes across benefits, pensions, and employment rights within a single policy package. The Prime Minister’s Office states that the reforms apply across multiple areas of household income and support systems.
Household income support and benefit changes
The reforms include adjustments to benefits aimed at supporting low-income households and reducing child poverty. The removal of the two-child benefit cap is expected to lift around 450,000 children out of poverty.
- Two-child benefit cap: removed to increase support for larger families
- Universal Credit uplift: increased standard rate payments for households
- Benefit uprating: working-age benefits increased by 3.8%
- Target groups: support extended to low-income families and vulnerable households
Pension increases and support for older households
State Pensions have been increased by 4.8%, benefiting more than 12 million people across the UK. The increase is worth up to £575 per year for individuals receiving the new State Pension.
Employment reforms and workers’ rights changes
Changes under the Employment Rights Act introduce new protections and entitlements for workers. These include expanded leave rights and reforms to Statutory Sick Pay to support income security during illness.
- Parental leave: day one entitlement introduced
- Paternity leave: available from the start of employment
- Sick pay reforms: improved access to Statutory Sick Pay
- Workplace protections: broader employment rights coverage
Energy costs and wage-related support measures
Additional measures include reductions in household energy costs and increases to minimum wage levels. These changes are intended to support disposable income and reduce financial pressure on households.
Household support measures overview
| Child poverty | 450,000 children lifted out of poverty through benefit cap removal |
| Pensions | 4.8% increase for over 12 million pensioners |
| Benefits | 3.8% rise for working-age benefits |
| Universal Credit | Standard rate increased above inflation |
Government response to economic and global pressures
The measures form part of a broader response to economic conditions and international developments affecting household costs. The Government has also taken steps to address energy pricing and global supply pressures.
Stakeholder Comments
Ministerial Comments
Keir Starmer, Prime Minister said;
“No matter the global uncertainty, my government will always be on the side of the British people in bearing down on the cost of living. I am proud that today we are lifting nearly half a million children out of poverty, boosting support for pensioners, and delivering the biggest upgrade to workers’ rights in a generation.”
In Conclusion
The measures introduced from 5 April 2026 establish a coordinated set of changes across benefits, pensions, and employment rights. The package affects multiple areas of household finances, combining immediate support with longer-term structural adjustments within the UK’s welfare and employment systems.
Sources: Prime Minister’s Office, 10 Downing Street; Rt Hon Sir Keir Starmer MP.
Prepared by Ivan Alexander Golden, Founder of THX News, an independent news organisation delivering timely insights from global official sources. Combines AI-analysed research with human-edited accuracy and context.
