While the Tory leadership campaign focuses on tax cuts and slashing public services, Brits face a cost-of-living emergency.
Thankfully for millions, Boris Johnson announced thE “big bazooka” package - which will need to tide Brits over until the spring - too late for his successors to cancel most of it.
With annual energy bills set to hit around £3,000 from October 1 - up from less than £1,300 a year earlier - the PM sent now-ex-Chancellor Rishi Sunak to announce £15bn of support.
The package begins today as benefit claimants start receiving £326 payments, followed by another £324 in the Autumn.
But Chief Executive of Child Poverty Action Group Alison Garnham said: “Today’s payment will still leave far too many families struggling to stay afloat.
“Families are facing a long term crisis that needs a long term solution, and government needs to recognise that dealing with the cost of living is made harder for millions by years of benefits cuts and freezes.”
Mike Brewer of the Resolution Foundation said it was “a bold and well targeted support package” but “households are still going to feel a tight squeeze over the coming year”
So what has been announced and, more importantly, when exactly will you get it? We go through month by month.
Earlier this year: £150 council tax rebate
Since April, people in England in council tax bands A to D should have received a £150 rebate from their council tax.
For most this has already arrived, but because it was administered by hundreds of individual councils, many residents experienced delays. If you have still not received your rebate, you should contact your local council.
This measure applies in England.
July 6: National Insurance threshold raised
On July 6, the threshold of what you can earn before paying National Insurance rose from £9,880 to £12,570 a year.
It has taken some of the lowest earners out of paying the tax, and save those still paying £330 a year.
But that’s before you factor in two things.
Firstly, National Insurance rose in April from 12% to 13.25% thanks to - you guessed it - Rishi Sunak.
Once you put the tax AND threshold rises together, only people who earn less than £37,000 will be better off than they were before April. And they might not feel like celebrating - £30k earners are only £53 better off per year.
Secondly, if you’re working but on Universal Credit, you’ll feel less help because for every pound you earn, 55p of benefits are “tapered” away. Models suggest a single parent on £16,000 and UC will gain £27 a month from the threshold change but £15 of that will be cut in Universal Credit.
This applies throughout the UK.
July 14-31: £326 for most benefit claimants
8.3million UK claimants of Universal Credit, Tax Credits, Income-related JSA, Income-related ESA, Income Support and Pension Credit will get two payments, first £326 then £324.
If you’re on any of these benefits except Tax Credits, your first payment should arrive in your bank account at some point between July 14 and July 31. Some complex cases will take longer.
Claimants must have begun a claim for these benefits by 25 May 2022 at the latest to qualify for the first of the two payments.
The £650 will be tax-free, will not count towards the benefit cap, and will not have any impact on existing benefit awards.
This applies throughout the UK.
'From autumn': £326 for some Tax Credit claimants
People on Tax Credits will also get two payments of £326 and £324. But theirs will take longer to arrive because they are being administered by HMRC, not the DWP.
After the Treasury originally hoped to give them out in late summer, it's now autumn for the first payment, and 'from winter' for the second payment.
This applies throughout the UK.
By September: £150 for disabled Brits
£150 will be paid into the bank accounts of 6million people on the following disability benefits:
- Disability Living Allowance
- Personal Independence Payment
- Attendance Allowance
- Scottish Disability Benefits
- Armed Forces Independence Payment
- Constant Attendance Allowance
- War Pension Mobility Supplement
People will have had to be claiming, or started a (later successful) claim for, these benefits by May 25.
They will be made directly, be exempt from tax, not count towards the benefit cap, and not have any impact on existing benefit awards.
The timing is not nailed down because the DWP has not passed the necessary laws to pay the money yet.
This applies throughout the UK.
Autumn: Second £324 payment for benefit claimants
As we explained, the £650 one-off payment for people on benefits is coming in two lump sums to bank accounts.
There is no date yet for the second, £324 lump sum, but the government says it will arrive in the Autumn for people on Universal Credit, Pension Credit, and most legacy benefits.
Again, people on Tax Credits will have to wait longer - the only guarantee is they’ll get it by the end of the year.
October to March: £400 energy bills discount for all
A “buy now pay later” £200 discount off all Brits' electricity bills from October 1 - which had to be paid back over five years - has been axed.
Instead, all households will get £400 off their electricity bills from October as a non-repayable grant.
You won’t get the £400 credited to your account in one go. It will happen over the course of six months from October to March.
So if you pay by monthly direct debit you might get £66.67 off your bill per month. It’s a direct discount off your bills, not cash you can spend.
That means you’ll likely find your monthly bills are still higher than they were at the same time last year.
Customers with pre-payment meters will have the money applied to their meter or via a voucher. The mechanism for each firm isn’t confirmed yet.
This applies throughout Britain but not Northern Ireland, where the administration has been told to devise its own scheme.
November to December: £300 payment for most pensioners
A one-off 'Pensioner Cost of Living Payment' of £300 will go to pensioner households who are receive Winter Fuel Payment in November or December.
These payments, worth £2.5bn, will be paid alongside the Winter Fuel Payment which is worth between £100 and £300 for pensioners.
For most pensioner households, this will be paid by direct debit. People are eligible if they're aged 66 or over by September 19, although some pensioners do not qualify for the Winter Fuel Payment.
This applies throughout the UK.
April 2023: Benefit and pension uprating
Even though benefits and pensions are not being permanently raised now - something many have called for - there will be a big rise next year.
April 2022's rise was a measly 3.1%, below inflation, because it was based on the CPI figure for September 2021. But in April 2023 the rise could be an above-inflation 10%.
Rishi Sunak said he would stick to that plan, subject to a review by the Work and Pensions Secretary. He said: "On current forecasts it's likely to be significantly higher than the forecast inflation rate for next year."
Mr Sunak also said the triple lock will return to the state pension - ensuring it rises by inflation, wages or 2.5%, whichever is highest. That means pensions are likely to rise by around 10% too. This isn't a surprise but is a big commitment after the Tories broke their manifesto pledge on the triple lock last time.
This applies throughout the UK, and could of course change once a new Tory leader is in place.
