Millions of households to benefit from a new £15 billion package of targeted government support
Millions of households across the UK are finding it harder to make their incomes stretch to cover the rising cost of living. Whilst the inflationary pressure is largely being driven by global price rises, it's absolutely right that the Government does everything it can to help people through this difficult period.
That's why I support the steps the Chancellor has taken to provide over £15 billion in further support, targeted particularly on those with the greatest need. This package is in addition to the over £22 billion announced previously, with government support for the cost of living crunch now totalling over £37 billion this year. This means that almost all of the eight million most vulnerable households will get £1,200 of one-off support in total this year to help with the cost of living, with all domestic electricity customers receiving at least £400. I'm also pleased that the State Pension triple lock will be reinstated next year and
I'm particularly pleased to see that around 75% of the support package is targeted at those who are most in need. with support being delivered through a combination of cash grants, automatic rebates, money off bills, and tax cuts.
Cost of living support
Low-income Households: a £650 cost of living payment to all households who receive means-tested benefits. All those who live in the UK and are in receipt of Universal Credit, Jobseekers Allowance, Employment and Support Allowance, Income Support, Working Tax Credit, Child Tax Credit, or Pension Credit are eligible. Payments will be made in two lump sums, with the first due from July and the second in the Autumn.
Pensioners: an extra £300 cost of living payment for every pensioner household in receipt of Winter Fuel Payments. This will be paid to around 8 million pensioner households in November or December, alongside the standard Winter Fuel Payment. This payment is in addition to the general £650 cost of living payment for those eligible for both.
Disabled people: an extra £150 cost of living payment for people who receive disability benefits – including Personal Independence Payments, Disability Living Allowance, and Attendance Allowance. This will be paid directly into bank accounts by DWP from September, and is in addition to the general £650 cost of living payment for those eligible for both.
These Cost of Living Payments are all exempt from tax and will not affect your eligibility for other benefits.
Support with energy bills
Energy rebate; the previously announced £200 repayable energy rebate is being replaced by a £400 cash grant for all households to help with the cost of energy bills. This will be applied directly to energy bills from October, with no need for households to apply.
Council Tax rebate: the previously announced payment of £150 to households living in council tax bands A-D, has already or will be paid by your local council. If you pay council tax by Direct Debit your rebate will be processed automatically. If you pay another way, your council will provide you with a cash voucher for the same amount. Barnsley and Sheffield councils started paying out the rebate in May 2022, and expect the process to have been completed by the end of June. Additional funding has been provided to councils to help households on low incomes in other council tax bands.
Warm Homes Discount: Every winter the Government provides a discount on energy costs to around 3 million low-income households. In 2022 this will be worth £150 for each eligible household, and is applied directly to your energy bill. If you think you might be eligible but do not already receive the Warm Homes Discount, you should contact your energy supplier directly.
Winter Fuel Payments: the Government provides payments of between £200 and £300 for households with someone of State Pension Age or over. If you are eligible the payment should be made automatically in November or December.
Other support
Household Support Fund: the Government is providing £1.5 billion to local authorities across the country for them to distribute to households and families who need financial support. This will include pensioners, families with children who receive free school meals, and others who are struggling with the rising cost of living.
- Barnsley Council is identifying households in receipt of Free School Meals or Pension Credit who will receive an automatic payment, whilst other households who need help will be able to contact them directly to apply.
- Sheffield City Council has set up a website for those who need to apply for help: https://www.sheffield.gov.uk/home/benefits/help-money-issues
Fuel Duty: the Government has cut the main rates of fuel duty for petrol and diesel by 5p per litre for 12 months from April 2022.
National Insurance Contribution threshold: from July 2022, the Government is raising the National Insurance Contributions threshold, meaning that employees won't have to pay NICs on their first £12,570 of earnings. This tax cut will benefit 30 million working people, with the average employee seeing their NICs cut by around £330 per year.
So many people do not claim the benefits and support they are entitled to, this is particularly the case with Pension Credit and Universal Credit, so if you know someone who is not yet claiming this support please do suggest they do so.
Pension Credit: across the country around 25% of people who are eligible for Pension Credit are not yet claiming it. Pension Credit is a top up for low-income pensioners that is worth an average of £3,300 per year. As well as a cash top up to the State Pension, it also entitles you to help with housing costs, council tax reduction schemes, cold weather heating payments, and a free over-75s TV licence. You can find out more and apply online here.
Universal Credit: Universal Credit is designed to help people who are on a low income, out of work, or cannot work. A wide range of people are eligible for Universal Credit, depending on their personal and/or family circumstances. You can find out more, check eligibility criteria, and apply online here
- Government information about cost of living support can be found here.
- Broader information about other available government financial support can be found here.
