Second part of cost of living payment confirmed for households in receipt of means tested benefits
In May 2022 Rishi Sunak announced a range of financial support measures to help families struggling because of the cost of living crisis. The package included a £650 cost of living payment for the lowest income households who are in receipt of means tested benefits. This was to be paid in two lump sums, the first in July and now the second lump sum has been confirmed to be paid in November.
This support has been welcome, and the next instalment will provide some much needed relief for the millions of families who are struggling.
Second cost of living payment for those on means tested benefits
The cost of living payments are being rolled out through the benefits system, enabling payments to be made directly to eligible households across the UK. For eligible households the £650 cost of living payment is being made in two instalments, the first payment of £326 was made in July. Details of eligibility and payment dates for the second payment of £324 have now been released.
What are the relevant dates to be eligible?
To be eligible for the £324, claimants will need to have been in receipt of one of the following benefits, or have begun a claim which is later successful, for the period 26 August to 25 September 2022:
- Universal Credit
- Income-based Jobseekers Allowance
- Income-related Employment and Support Allowance
- Income Support
- Pension Credit.
When will payments be made?
These eligible households will receive the payment of £324 between the 8 and 23 November 2022.
This payment will be tax-free, will not be counted towards the benefit cap and will not impact on existing benefit awards.
What about households in receipt of Tax Credits?
There is a separate process for those not in receipt of any of the benefits above but who are in receipt of:
- Working Tax Credit
- Child Tax Credit.
Claimants in receipt of either of these received their first payment in August or September, and will receive the second instalment of £324 paid in Autumn 2022. The payment dates have yet to be confirmed by the Government, but they are expected to be paid shortly after the payments to those in receipt of other means tested benefits.
Summary of other measures
The £650 cost of living payment was part of a range of financial support measures announced over the last few months, some of which have already been paid to households, these include:
- People who receive disability benefit will already have received an additional one-off grant of £150.
- Pensioners who receive winter fuel payment will receive a one-off payment of £300 paid with their normal payment from November 2022.
- Every household in the UK will get £400 of support to help with increasing energy bills from October in Great Britain and November in Northern Ireland. Most households will receive this support via their energy suppliers as a credit applied to their account.
- The Energy Price Guarantee reduces and puts a cap on the amount that households can be charged per unit of electricity and gas, therefore saving money compared to what the expected prices would be over the next two years.
- Home heating oil customers and those not served by the gas grid will receive an additional payment of £100 towards heating costs not covered by the Energy Price Guarantee.
The previous Chancellor also committed to uprate benefits next April in line with inflation, however this has yet to be confirmed by the current Government. Doing so would offer some much needed security for lower income households in the next financial year, who this year saw benefits rise at a much lower rate than prices
To make a real difference, the Chancellor needs to uprate benefits in line with inflation now, lift the benefit cap and two child limit, and invest in strengthening the social security system for the longer-term.
The details of this announcement are available here. For more information on the broader cost of living support measures announced by the Chancellor, there is a factsheet produced by the Government and a further factsheet giving information on support for energy bills.
There is also helpful information available from the Energy Saving Trust on the small changes that could help to reduce your energy bills across the year.
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 email@example.com.