The Government is starting to pay the first half of the £650 cost of living payments this week to millions of people on Universal Credit and other benefits. They will get £326 to help their household finances as bills rise during soaring inflation.
This first payment will go to 8.4 million low-income households from Thursday (July 14) and a second payment of £324 will be made in the autumn. The payments come amid warnings that energy bills could hit £3,300 by October and at a time when petrol and food costs are rocketing.
According to recent Office for National Statistics (ONS) figures covering adults in Britain between late June and early July, around nine in 10 (91%) said their living costs had increased over the previous month.
Around half (49%) of people reported that they were buying less food when food shopping and 48% said they had to spend more than usual to get what they normally buy. The vast majority of those surveyed had taken at least one action to save energy in the past year.
And while the money is being given to benefits claimants, the Mirror reports that it all depends on what state support you get whether you are eligible.
You will need to be on means-tested benefits to get the £650 payments - and even then there are exceptions. Your income and savings are taken into account with means-tested benefits.
The government's thinking is that these people are the least well-off and need the £650 the most. But this still leaves millions of people on other benefits without the help of the extra Government cash.
The list of benefits eligible for the £650
- Universal Credit
- Income-based Jobseekers Allowance
- Income-related Employment and Support Allowance
- Income Support
- Working Tax Credit
- Child Tax Credit
- Pension Credit
Those eligible will be paid automatically, so they do not need to apply and payments may appear in accounts as “DWP Cost of Living”. Many people will receive the first instalment between July 14 and 31, although for those receiving Tax Credits, the first payment is to be made from the autumn and the second from winter 2022.
The list of benefits where claimants won't get the £650 are:
- Attendance Allowance
- Carer's Allowance
- Child Benefit
- Disability Living Allowance (DLA)
- 'New style' Employment and Support Allowance
- Guardian's Allowance
- 'New style' Jobseeker's Allowance
- Maternity Allowance
- Personal Independence Payment (PIP)
- State pension
- Statutory sick pay
- Statutory adoption, maternity, paternity and shared parental pay
If you get Housing Benefit, but no other benefit, you are also not eligible for the £650. This sounds surprising, because Housing Benefit is means-tested and so claimants should be due cost of living payments.
But if you only get Housing Benefit then HM Revenue & Customs cannot find you to pay you the money. Instead, the Chancellor has advised people in this position to apply to the Household Support Fund - a pot of emergency cash handed out by local councils to people in need.
The second payment of £324 will come in the autumn, although no set date has been announced yet.
I'm not eligible for the £650 - what help can I get?
If you claim certain disability benefits, there is a £150 cost of living payment due in September. Pensioners in receipt of Winter Fuel Payments will get an extra £300.
Every home in England, Scotland and Wales will also receive £400 off their energy bills, spread out over six months from October. Rather than a cash payment, the money will be applied directly to your energy account.
Direct debit and credit customers will have the money credited to their account, while those with pre-payment meters will have the money added to their meter or paid via a voucher. Support to people in Northern Ireland has not yet been announced.
This is in replacement of the £200 "loan-not-loan" that had originally been announced last year by the Chancellor. Other help is also available through the Household Support Fund, which is being paid out by local councils.
Each local authority decides who to give the money to, and how the money should be spent - so you may face a postcode lottery in terms of the help available to you. The help on offer does vary, but can include cash grants and supermarket vouchers.
The then Chancellor Rishi Sunak extended the Household Support Fund as part of a wider £15billion package to tackle the cost of living crisis. Speak to your council to see what help it offers and if you’re eligible for support.
