A softening of the Government’s welfare programme to alleviate its impact on low-income families has been welcomed by campaigners, but further changes are being demanded.

Work and Pensions Secretary Amber Rudd revealed plans to scrap extending a benefits cap on families with more than two children (for children born before the system began in 2017). She also proposes lifting the freeze on benefit levels when the current cap ends in 2020 and consulting MPs before rolling Universal Credit out to more than 3 million claimants.

Charities like the Child Poverty Action Group said the decision was “fantastically good news”, but it is still calling for the two-child cap to be scrapped for all other families. Labour and the SNP said the change “does not go far enough”.

There is also pressure on Ministers to speed up the process for making payments to new claimants. This has already fallen from six to five weeks, but Rudd is proposing to run a pilot involving 10,000 people and learn from this.

Ms Rudd said: “I’m making a number of changes to our welfare system to make sure that it delivers on the intent which is to be a safety net and also to be a compassionate and fair system helping people into work.”

Dropping the benefits cap on families with two children born before UC was introduced is thought to affect about 15,000 households, while upto 3 million people were expected to migrate from the old benefits sytem to Universal Credit in the coming months and years.

Frank Field, who chairs the Work and Pensions Committee, was supportive of the changes. He said: “I strongly welcome the decision not to press ahead with what could have been the cruellest benefit cut in history. At the eleventh hour, she has prevented thousands of children from being plunged into poverty by an unjustifiable retrospective policy.”

By Patrick Mooney, editor