“Tackling child poverty is our mission as a region,” North East mayor Kim McGuinness said earlier this year. Her words feel timely after Rachel Reeves told the BBC she does not think children in larger families should be “penalised”, a clear signal the two‑child benefit cap could finally go. For families across Teesside, Tyneside and Greater Manchester, that matters.

Pressed on BBC Radio 5 Live, the chancellor said “a child should not be penalised because they are in a bigger family,” and promised action on child poverty alongside a difficult Budget later this month. The Treasury has already set 26 November as Budget day.

A quick explainer. The two‑child limit restricts Universal Credit and tax credit payments for a third or subsequent child born after April 2017. It is separate from Child Benefit, which is universal but clawed back via the High Income Child Benefit Charge between £60,000 and £80,000 of individual income, with full withdrawal at £80,000.

What difference would scrapping the limit make? The Institute for Fiscal Studies says abolishing it would eventually lift about 540,000 children over the absolute poverty line at a cost of £2.5bn a year. Removing both the two‑child limit and the overall benefit cap would lift around 620,000 children, costing roughly £3.3bn.

The North has the most to gain. Government figures show child poverty rates above 40% in several local authorities, including Middlesbrough (40.4%), Bradford (44.2%) and Oldham (42.9%). Nine of the 20 highest‑rate councils are in the North West alone.

Frontline groups here have been blunt. “We see first‑hand the impact,” Citizens Advice charities across Greater Manchester told the mayor in May, urging ministers to lift the cap and warning that more families are being pushed into debt and homelessness.

Politics will be febrile until the Budget. The SNP forced a Commons vote on 16 September to scrap the cap; several Labour MPs backed it, while Conservatives opposed. Tory leader Kemi Badenoch has since vowed to re‑introduce the policy if Labour axes it. Greater Manchester mayor Andy Burnham has called the cap “the worst of Westminster”.

Thinktanks are urging Reeves not to fudge it. The Resolution Foundation warns that only full repeal will substantially cut child poverty; tapered or partial versions won’t shift the dial. That mirrors new DWP data showing the policy increasingly hits working large families.

Reeves has also hinted she may break Labour’s 2024 pledge not to raise income tax, VAT or National Insurance, arguing that sticking rigidly to it would mean deep spending cuts. Expect a balancing act between tax rises and an anti‑poverty push on 26 November.

For households, two points matter now. First, the Child Benefit rules are unchanged: entitlement remains, but the HICBC tapers it away from £60,000 to £80,000 of income. Second, if the two‑child limit goes, anti‑poverty groups say it’s the “essential first step”-but they’ll still press for wider reforms to stop children in the North growing up poor.