DWP Cost of Living payment changes for 2023 including Universal Credit and energy discounts

The cost of living crisis is an ongoing issue for millions of household across the UK with energy bills still rising for some.

To help ease any financial stress, there are some cost of living payments many people will be entitled to, with £900 set to be paid to select groups throughout the next year.

The boost will be eligible people who are claiming Universal Credit, Pensions Credit, tax credits and Jobseekers Allowance.

READ MORE: PIP claimants with any of these 21 health conditions may be eligible for £627 per month

There are a number of other changes being made throughout 2023, with benefit rises also scheduled. To keep you informed, here's a breakdown of all the key finance changes coming this year, according to MEN.

January to March 2023 - Energy discount

A £400 energy bill discount payment was announced with the first being issued last year. The payments are being split into six instalments and will see UK households receive a total £400 discount on their energy bill between October 2022 and March 2023.

The first payments were issued in October and November and were £66 each. This was followed by a payment of £67 in December.

Now in a new month, people can expect payments of £67 from January to March 2023.

January 2023 - Winter Fuel Payment

The winter payments, worth up to £600, was put in place to help people with their heating bill and in addition tot his, a £300 one-off payment which is being added to the annual Winter Fuel Payment. This is set to arrive before January 13, 2023 although at this stage, no specific payment windows has been given.

It is taxed and does not affect eligibility for other DWP benefits. However, the full amount you will get for winter 2022 to 2023 depends on your household circumstances.

March 2023 - Spring statement

Jeremy Hunt will deliver a spring statement to the House of Commons in March to set out the government’s economic plans. People should listen out for key issues such as taxes, savers, homebuyers and pensioners which may be discussed.

Last March former chancellor Rishi Sunak didn't announce changes to Universal Credit or other DWP benefits however depending on what happens with the cost of living situation, Mr Hunt could announce an update.

Spring 2023 - First cost of living payment worth £301

The Department for Work and Pensions (DWP) announced that the first payment for the £900 cost of living payment will come into Spring 2023.

There are more key dates which Martin Lewis has announced which can be found here.

Chancellor of the Exchequer, Jeremy Hunt said: “I know these are tough times for families across the UK who are struggling to meet rising food and energy costs, driven by the aftershocks of Covid and Putin’s war in Ukraine. That’s why we’re putting a further £900 into the pockets of over 8 million low income households next year.

"These payments are on top of above inflation increases to working-age benefits and the Energy Price Guarantee, which is insulating millions from even higher global gas prices. Tackling inflation is this government’s number one priority and is the only way to ease the strain of high prices, drive long term economic growth and improve living standards for everyone.”

April 6, 2023 - Benefits and pensions

Inflation-linked benefits and tax credits will rise by 10.1 per cent from April 2023, in line with the Consumer Prices Index (CPI) rate of inflation in September 2022.

Jeremy Hunt said the 'expensive commitment' worth £11 billion means 10 million working-age families will see a much-needed boost meaning on average, a family on universal credit will benefit of an increase by around £600.

The benefit cap will rise from £20,000 to £22,020 for families nationally. Lower caps for single households without children will rise from £13,400 to £14,753 nationally

Here’s a full list of DWP benefits that will increase from April next year and how much you will get, with figures taken from the official Government website.

Universal Credit

If you’re on Universal Credit, the monthly standard allowance will be increasing as follows:

• If you’re single and under 25, the standard allowance will go up from £265.31 to £292.11
• If you’re single and aged 25 or over, the standard allowance will increase from £334.91 to £368.74
• Joint claimants’ who are both under 25 will see their standard allowance will go up from £416.45 to £458.51
• While joint claimants where one or both are 25 or over, will see their standard allowance go up from £525.72 to £578.77

Universal Credit for those with Children

Any extra payments you receive for children will also be going up next year.

• If your first child was born prior to April 6, 2017, you’ll receive £319.29 (as compared with the current rate of £290)
• If your child was born on or after April 6, 2017, or you have a second child and subsequent child, you’ll receive £269.28 (as compared with the current rate of £244.58)
• If you have a disabled child and receive a lower rate addition, your payment will increase from £132.89 to £146.31
• If you have a disabled child and receive a higher rate addition, your payment will increase from £414.88 to £456.78

Universal Credit for a limited capability for work

• If you have limited capability for work, the extra support you'll receive will go up from £132.89 to £146.31
• If you have limited capability for work and work-related activity, the amount will go up from £354.28 to £390.06

Universal Credit for carers

Those caring for a severely disabled person for at least 35 hours a week are entitled to support.

In the year 2023/2024, this amount will rise from £168.81 to £185.86.

Universal Credit for increased work allowance

The higher work allowance for those with one or more dependent children, or limited capability for work, will increase from £573 to £630.87, while the lower work allowance is going up from £344 to £378.74.

Housing benefits

If you’re single, housing benefits will increase as follows:

• For under 25s, it’ll rise from £61.05 to £67.22
• If you’re on main phase ESA, from £77 to £84.78
• For those aged between 25 and state pension credit age, from £77 to £84.78
• For anyone who has reached pension age, £197.10 to £217

For lone parents:

• If you’re under 18, payments will increase from £61.05 to £67.22
• If you’re on main phase ESA, from £77 to £84.78
• If you’re aged between 18 and state pension credit age, from £77 to £84.78
• If you’ve reached state pension age, from £197.10 to £217

For couples:

• If both are aged under 18, payments will go up from £92.20 to £101.51
• If one or both are aged between 18 and state pension credit age, from £121.05 to £133.27
• If you’re on main phase ESA, from £121.05 to £133.27
• If one or both have reached pension age, from £294.90 to £324.68

Pension Credit

Pension Credit exists to support retirees on a low income. From April next year, the rates will rise as follows:

• For those who are single, your income will be topped up to £201.04 instead of the current rate of £182.60
• For couples, it’ll be topped up to £306.85 as compared with the current rate of £278.70

If your income is lower than this, you should be eligible for the benefit. Other top-up amounts for carers can be found here.

Attendance Allowance

If you have a disability severe enough that you require somebody else to look after you, you may be entitled to Attendance Allowance. It’s paid at two rates depending on how much the level of care that you need.

The lower rate will go up from £61.85 to £68.10 The higher rate will go up from £92.40 to £101.73.

Carers Allowance

If you care for someone at least 35 hours a week (and they get certain benefits), you can claim Carer’s Allowance. From April next year, the rate will increase from £69.70 to £76.74 a week.

Disability Living Allowance

The Disability Living Allowance (DLA) is being replaced by Personal Independence Payment (PIP) for disabled people. You can only apply for DLA if you're under 16 and you live in England or Wales. Those who live in Scotland can apply for Child Disability Payment.

For adults, further details on the eligibility criteria can be found here. Next year, DLA care component rates will increase as follows:

• The highest rate will go up from £92.40 to £101.73
• The middle rate from £61.85 to £68.09
• The lowest rate from £24.45 to £26.92

DLA mobility component rates will increase as follows:

• The higher rate will go up from £64.50 to £71.01
• The lower rate from £24.45 to £26.92

Employment Support Allowance

This benefit provides support to those on a low income by topping up their pay where needed. Here’s how it’s changing from April next year:

• If you’re under 25 years old, support will increase from £61.05 to £67.22
• If you’re 25 and older, from £77 to £84.78
• Lone parents under 18 will see the rate go up from £61.05 to £67.22
• Lone parents who are 18 or over, from £77 to £84.78

There are also further rates for couples, those with disabilities or caring responsibilities, which can be found here.

Jobseekers Allowance

Jobseekers Allowance (JSA) exists to support unemployed people while they look for a job. It’s being replaced by Universal Credit, but those still claiming JSA will see their payments increase in the new year.

• If you’re under 25, contribution-based and income-based payments will increase from £61.05 a week to £67.22
• If you’re 25 or over, these rates will go up from £77 to £84.78 a week

Rates for couples, those with children, disabilities or caring responsibilities can be found here.

Maternity, paternity, adoption and shared parental pay

The statutory rates for maternity, adoption, paternity and shared parental pay will all increase from £156.66 to £172.48. Payments for parental bereavement will also go up by the same amounts.

Maternity allowance

This will benefit new mums who don't qualify for standard maternity pay. If you qualify, payments will rise from £156.66 a week to £172.48 from April 2023.

Income support

The amount of Income Support you receive will depend on your circumstances. But if you're single and aged between 16 and 24, your weekly payments start from £61.05. This amount will now increase to £67.22 a week from April, 2023.

Personal Independence Payment

This payment, known as PIP, helps with extra living costs for those with illnesses or disabilities. From April next year, the rates will change as follows:

• The enhanced daily living component will go up from £92.40 to £101.73
• The standard daily living component will increase from £61.85 to £68.10
• The enhanced mobility component will rise from £64.50 to £71.01
• The standard mobility component will rise from £24.45 to £26.92 for standard

State Pension

The new State Pension rate will increase from £185.15 a week to £203.85. For the old state pension, the basic rate will rise from £141.85 to £156.18.

April 2023 - Energy price guarantee

The Energy Price Guarantee protects consumers reducing the unit cost of electricity and gas so that that a typical dual fuel direct debit bill for January 2023 remains at £2500.

This will be increased from April 2023 to a new level of £3000, with cost-of-living payments of £900 for those on means tested DWP benefits, £300 to pensioners, £150 to those on disability benefits and doubling support for those on LPG or heating oil.

The government said: "This winter (1 October 2022 to 31 March 2023) the Energy Price Guarantee is saving a typical household in Great Britain around £900, compared to undiscounted energy prices under the price cap. As announced in the 2022 Autumn Statement, the Energy Price Guarantee will be extended from April 2023 until April 2024.

"Over this period a typical household bill in Great Britain will be reduced to around £3,000. Based on projections of the undiscounted price of energy, this is expected to save the typical household in Great Britain around £500."

Summer 2023 - £150 disability payment

An additional disability cost of living payment will automatically be paid in the summer by the DWP or HMRC, where applicable. The exact date and who qualifies for the payment has yet to be announced.

October 2023 - September inflation announcement

September's inflation rate figure is really important as it's used to calculate changes to benefits and tax credits. This year's figure of 10.1 per cent have been used to calculate rises in April 2023. The triple lock also means that each year the state pension increases by the largest of the following three figures: 2.5 per cent, the rate of inflation, or the rate of earnings growth. It’s the September inflation figure that is used in this comparison.

Autumn - Second cost of living payment

The second part of the government's £900 cost of living payment will roll out this Autumn. Eligible recipients will receive £300. The exact date is yet to be announced.

November - Autumn statement

The Chancellor's Autumn Statement is like a mini-budget. Last month's mini-budget provided critical updates on energy bills, inflation, taxes and new DWP cost of living payments.

Winter - £300 pensioner payment

The government will issue a cost of living payment for pensioner households worth £300 in the winter. The date is yet to be announced.

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