A range of measures have been introduced in the UK to combat the cost of living crisis as the nation battles rising inflation and soaring energy prices.
These range from a £650 payment being made to millions of the UK’s most vulnerable households to a universal £400 energy grant which will arrive in autumn.
The support payments were announced earlier in two stages this year by the former Chancellor Rishi Sunak – here’s everything you need to know about them.
When is the second cost of living payment?
The one-off £650 cost of living payment is being made in two installations to all households on means-tested benefits, including those receiving the following:
- universal credit
- Income-based jobseeker’s allowance
- Income-related employment and support allowance
- income support
- Working tax credit
- child tax credit
- pension credit
For people who qualify through means tested benefits, the first installation of the £650 began automatically landing in bank accounts from Thursday 14 July onwards, continuing to the end of the month.
The Government announced that the second and final payment would be issued directly to households in autumn, with a precise date yet to be confirmed.
Those eligible solely through receiving child tax credit and working tax credit will have to wait until autumn for the first installation, with a precise date yet to be decided. The second payment will then arrive in winter, with further details again still to be confirmed.
The DWP explained: “Payments from HMRC for those on tax credits only will follow shortly after each to avoid duplicate payments.”
For all claims, the first installation is £326 and the second payment will be £324. The Government said: “The payments are designed to be deliberately slightly unequal to minimize fraud risks from those who may seek to exploit this system.”
If you are eligible for the payment, there is no need for you to apply – the £650 will be submitted to you automatically, and should show in your bank account with the code “DWP COL” or similar.
The grant is tax-free for all eligible groups, will not affect the benefit cap and will not affect existing benefit awards.
Payments appeared to come through comparatively promptly after the roll-out began, in contrast to the council tax rebate, which encountered delays in many areas.
A week after the payments started, the Government said that over 7.2 million of the cost of living payments had been made, totaling £2.4 billion.
When will the £400 energy grant be paid?
The £400 energy payment is being made to every household in the country, without means testing.
Originally plan, the plan was for households to receive a £200 discount on their energy bills in October, which would then be paid back over five years from 2023, with customers paying an additional £40 on their bills each year.
However, in late May – and after much criticism, Mr Sunak announced the discount would be increased to £400, and will no longer have to be paid back.
The £400 discounts will start in October and will be paid out to consumers in installations over six months, with the grants administered through the energy suppliers.
The discount will break down into facilities of £66 on people’s energy bills in October and November, rising to £67 each month from December through to March 2023.
It will be provided on a monthly basis, regardless of whether people pay bills monthly, quarterly or have an associated payment card.
Those with a domestic electricity meter point who make payments through payment cards, standard credit, and direct debit will receive an automatic deduction on bills over the 6 month period.
People who use prepayment meters and top up their credit before using energy, will be provided with discount vouchers in the first week of each month.
These will be sent by text message, email or post with the most up-to-date contact details customers have left with the suppliers.
When will pensioners get £300 in cost of living support?
Most pensioners will already be familiar with the winter fuel payment, an annual tax-free lump sum issued by the Department for Work and Pensions.
This year, the Government is adding an extra £300 to boost the support for over eight million pensioner households.
It means that people born on or before 25 September 1956 could be eligible for between £250 and £600 to help pay their bills.
According to the Government, payments are usually made in November or December, and should be paid by 13 January 2023.
You don’t typically have to apply for the winter fuel payment, and if you are eligible most people should receive the money automatically.
However, if you do not receive the state pension or another social security benefit, or live abroad, you may need to make a claim.
You can do this from Monday 1 August 2022 onwards, and the Government website has full details on how to make a claim here, and eligibility rules here.