A new plan would see the Department for Work and Pensions (DWP) boost all payments of Universal Credit and legacy benefits by a minimum of £25 a week to help families through the ever-worsening cost of living crisis.
Campaigners are calling on the Government to act swiftly, saying it's an emergency as severe as when the covid pandemic hit. A Universal Credit top-up of £20 a week was cut in October 2021 after being in place for 18 months, which amounted to an extra £1,560.
Following the news of further huge hikes to the energy price cap in less than five weeks time, welfare organisations are asking for an immediate national response, Birmingham Live reports.
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Thomas Lawson, chief executive of national poverty charity Turn2us, said the "meteoric rise in the energy cap will cripple those of us in the UK already struggling to stay afloat." He added: "This is no longer a choice between heating and eating, but not being able to afford either.
"This is as big an emergency as the impact of covid and needs a similarly confident government response. As one of the wealthiest economies, it’s simply not acceptable to consign more than a quarter of us into poverty."
The charity is calling on the Government to act now and introduce a cap on energy costs and increase the value of Universal Credit and legacy benefits by a minimum of £25 a week. Others are asking for action too.
Fuel poverty charity National Energy Action (NEA) estimates the rise will increase the number of UK households in fuel poverty from 4.5 million last October to 8.9 million this October. That's even when the Government's support package is taken into account.
Adam Scorer, National Energy Action (NEA) chief executive, said: "The scale of harm caused by these price rises needs to sink in. A warm home this winter will be a pipedream for millions as they are priced out of a decent and healthy quality of life.
"The Government needs to immediately upgrade the household support package it first announced back in May. Households need money in their pockets to weather this storm or we are going to see millions in dangerously cold homes, suffering in misery with unimaginable debt and ill health."
Analysts at Cornwall Insight warn that October's energy rise isn't the end of it. They are forecasting that prices will rise from £3,549 in October to £5,387 in January when the next price cap review comes into effect, a 52 per cent increase, and then to £6,616 in April, up another 23 per cent. That would take the average monthly bill from £296 in October (already up from £164) to £449 in January and £551 in April.
Chancellor Nadhim Zahawi has said the Government was "working flat out" to develop a new package of support for consumers. He said: "This will mean the incoming Prime Minister can hit the ground running and deliver support to those who need it most, as soon as possible."
The current cost of living measures from the Government include £650 for people on Universal Credit and six legacy benefits. You should get two lump sums of £326 and £324 if you get payments of any of the following:
- Universal Credit
- income-based Jobseeker’s Allowance (JSA)
- income-related Employment and Support Allowance (ESA)
- Income Support
- Pension Credit
- Child Tax Credit
- Working Tax Credit
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