An update on cost of living payments for households across the UK

In May, the then Chancellor Rishi Sunak announced a package of UK-wide financial support measures to help families struggling because of the cost of living crisis. The package includes a universal payment for all households, to offset increasing energy bills, along with more targeted measures for those most in need.

Since then, further information has been made available including an update on when households can expect to receive these costs of living payments. It is important to note, all payments will be made automatically – if you are eligible, no application is required.

In summary:

1. £400 payment for every household in the UK to offset increasing energy bills: This will be paid in six monthly instalments for households in England, Scotland and Wales from October 2022. Households in Northern Ireland will receive the payment, but details of when and how are still to be confirmed.
2. £650 cost of living payment for households on means tested benefits: Many households have already received the first of two instalments of this payment. The second instalment will be paid in the Autumn. For those in receipt of Tax Credits, their first payment will be issued between 2 and 7 September 2022, followed by the second in the Winter.
3. £300 grant for pensioners: Pensioners who receive the winter fuel payment will receive a one-off payment of £300 alongside their winter fuel payment this year.
4. £150 grant for those on a qualifying disability benefit: People who receive a qualifying disability benefit will receive an additional one-off grant of £150 from 20 September 2022.

Further detail is available below.

Cost of living payment for those on means tested benefits

The cost of living payment of £650 for those families on means tested benefits, including Tax Credits, is being made in two instalments, the first of £326 with a later follow up payment of £324.

While some eligible households received their first payment in July, those in receipt of Tax Credits have had to wait.

Update for Tax Credit Claimants

The Government has now confirmed that the first instalment of the one-off cost of living payment of £650 for eligible households in receipt of Tax Credits will be issued between 2 and 7 September.

To be eligible for the first instalment of this payment, you must have an award of either Child Tax Credit or Working Tax Credit, for any day in the period from 26 April 2022 to 25 May 2022.

This means that during that period you must have been entitled to either:

1. a payment of tax credits; or
2. an annual award of at least £26 of tax credits; or
3. later found to have had an entitlement during that period.

When will the second payment be made?

The qualifying date to be in receipt of relevant benefits in order to be eligible for the second payment of £324 has yet to be announced, along with the payment date. However it is expected that the second payment for those receiving relevant means tested benefits will be made in the autumn while those on Tax Credits will again receive the payment at a different and later date in the winter.

Help with energy costs for all UK households

Households across the UK will receive £400 toward their energy costs through the Energy Bill Support Scheme.

For households in England, Scotland and Wales this £400 will be paid to consumers via energy suppliers as a discount on bills split over a 6 month period beginning in October.

Households in Northern Ireland will also be eligible for the £400 Energy Bill Support Scheme, however the mechanism and timeline for delivery of this payment has yet to be finalised.

Cost of living payment for those on a qualifying disability benefit

The Government is paying £150 to 6 million people who are in receipt of a qualifying disability benefit. These payments will be paid automatically from 20 September 2022.

The payment will help to support disabled people who are impacted by the rising cost of living, acknowledging the higher disability-related costs they often face, such as for care and mobility needs.

To be eligible for the one-off payment of £150 in September you must have received a payment (or later received a backdated payment) of one of the following qualifying benefits for 25 May 2022:

1. Disability Living Allowance
2. Personal Independence Payment
3. Attendance Allowance
4. Scottish Disability Benefits (Adult Disability Payment and Child Disability Payment)
5. Armed Forces Independence Payment
6. Constant Attendance Allowance and
7. War Pension Mobility Supplement.

 Further information

For more information on the cost of living support measures announced by the Chancellor, there is a factsheet produced by the Government, and information available on the NI Direct website.

To make sure your family is claiming all the financial support you are entitled to, contact the Family Benefits Advice Service for a free, personalised ‘better off’ calculation. Freephone 0800 028 3008 or email hello@employersforchildcare.org.