This February, many in the UK will still be looking anxiously at their energy bills and thinking twice about switching the heating on.
Ofgem’s energy price cap has been frozen at £2,500 until April for average users and the market turmoil which followed last year’s political chaos in Westminster appears to have been soothed, but for many this remains a difficult winter.
The UK rate of inflation currently stands at 10.5 per cent, keeping the cost of goods on supermarket shelves high. Meanwhile, the Bank of England’s Monetary Policy Committee has set interest rates at 3 per cent and chancellor Jeremy Hunt delivered a bleak Autumn Statement back in November.
That announcement saw him introduce a package of tax rises worth £24bn and spending cuts of £30bn in order to plug a massive funding black hole in Treasury coffers and reassure the global financial markets that Britain remains a trusted trading partner.
But more state support will be paid out to help with the cost of living crisis over the course of the month.
Here is a guide to what you can expect and who is eligible.
State benefits and pensions
These payments will go out directly on their usual dates this February, with no public holidays forthcoming to complicate the process:
- Universal Credit
- State Pension
- Pension Credit
- Disability Living Allowance
- Personal Independence Payment
- Attendance Allowance
- Carer’s Allowance
- Employment Support Allowance
- Income Support
- Jobseeker’s Allowance
For more information on how and when state benefits are paid, please visit the government’s website.
In addition, a number of cost of living support payments announced by the state last year are still active.
Energy discount payment
One of the headline gestures Mr Sunak announced during his tenure as chancellor last spring was that every household would receive a £400 energy bill discount to soften the blow of rising bills resulting from the European energy crisis.
This replaced a planned £200 universal loan that he announced in February 2022, doubling that figure and turning it into a grant that doesn’t need to be paid back.
The first £66 instalment was dispatched in October, followed by another in November and £67 in December and January. There will be another £67 payout in February and a final instalment in March.
Those who pay their bills by direct debit will receive the discount automatically – either as a deduction to their monthly payments or as a refund to bank accounts.
Those who pay on receipt of an invoice will see the discount applied as credit to their energy account every month.
Smart prepayment meter customers will also receive the discount automatically monthly and prepay customers will be sent discount vouchers by text, email or post that they will need to redeem manually.
Cold Weather Payment scheme
This government scheme reopened on 1 November and runs until 31 March 2023, granting £25 to people on low incomes for every seven-day period in which sub-zero temperatures occur.
The cold snaps we experienced in the second week of December and the middle of January did not quite last long enough to trigger it but who knows what’s around the corner?
The prospect of sudden stratospheric warming over the Arctic turning polar winds easterly and ushering in a new “Beast from the East” akin to that which struck the UK in March 2018 has already been mooted and could yet materialise, bringing a fresh round of snow and ice.
Should such an event happen and a Cold Weather Payment be signed off, the money would be paid to anyone registered with Department for Work and Pensions (DWP) to receive a qualifying benefits payment, such as: Pension Credit, Income Support, Income-based Jobseeker’s Allowance, Income-related Employment and Support Allowance or Universal Credit.
Warm Home Discount scheme
The government’s winter heating support scheme was also revived on 14 November and runs until 31 March, granting £150 to qualifying recipients to see them through the coldest season, the money taken off their energy bills directly by their supplier.
The money will be paid to help with high energy costs to anyone receiving the following benefits: Pension Credit, Income-related Employment and Support Allowance, Income-based Jobseeker’s Allowance, Income Support, Universal Credit, Housing Benefit or Child Tax Credits and Working Tax Credits.
It’s also worth bearing in mind that the DWP has announced that millions of households on low incomes will receive further cost of living support worth up to £1,350 from the spring.
The new £900 cash support for over eight million eligible means-tested benefits claimants, including people on Universal Credit, Pension Credit and Tax Credits, starts in the spring and will go directly to bank accounts in three payments, the DWP said.
There will also be a separate £150 payment for more than six million people with disabilities and £300 for over eight million pensioners on top of their Winter Fuel Payments.
Here are the additional payment windows announced:
- £301 – First cost of living payment – during spring 2023
- £150 – Disability payment – during summer 2023
- £300 – Second cost of living payment – during autumn 2023
- £300 – Pensioner payment – during winter 2023/4
- £299 – Third cost of living payment – during spring 2024
