New cost-of-living payments due in Spring
The government has announced them for low-income households
Millions of households on low incomes will receive fresh cost-of-living support from this Spring.
That's according to the Department for Work and Pensions (DWP), which has announced further details on the payments schedule.
The next round of support for households was previously unveiled in the autumn statement, building on payments made to more than eight million people in 2022.
How much?
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.
The £900 payment will be made up of three slightly different amounts, relating to specific qualifying periods, making it simpler to determine if someone has received the correct payments, the department added.
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.
Exact payment windows will be announced closer to the time, the Government said, adding that payments will be spread to ensure consistent support throughout the year.
They will include a first cost-of-living payment of £301 made in spring 2023; a £150 disability payment during summer 2023; a £300 second cost-of-living payment in autumn 2003; a £300 pensioner payment during winter 2023/4; and a third cost-of-living payment of £299 made in spring 2024.
'No increase for most vulnerable'
However, fuel poverty campaigners have argued that support for the most vulnerable people has not increased on what was announced last year.
Simon Francis, co-ordinator of the End Fuel Poverty Coalition, said: "This winter we have seen over nine million adults living in Dickensian conditions in cold damp homes.
"Yet despite energy bills increasing by 20% from April 2023, the support for the most vulnerable announced by the Government has not increased from last year.
"In fact, with the end of the Energy Bills Support Scheme looming, households will be worse off than they were this winter.
"The Government must go further to help the millions of homes in fuel poverty throughout 2023.
"This does mean more financial support, but also non-financial measures such as banning the forced transfer of households onto more expensive pre-payment meters."
Work and Pensions Secretary, Mel Stride, said: "We are sticking by our promise to protect the most vulnerable and these payments, worth hundreds of pounds, will provide vital support next year for those on the lowest incomes."
Chancellor, Jeremy Hunt, added: "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 eight 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."
The Government said payments to those who are eligible will generally be automatic, so there will be no need to apply.
People should watch out for scammers sending fake cost-of-living messages attempting to trick people into handing over their personal information.
Claimants who are eligible for any of the cost-of-living payments and receive tax credits, and no other means-tested benefits, will receive payment from HM Revenue and Customs (HMRC) shortly after DWP payments are issued.
Benefits, including working-age benefits and the state pension, will rise in line with inflation from April 2023, ensuring they increase by over 10%.
April will also see the biggest ever cash rise to the National Living Wage, bringing it to £10.42 an hour, the Government said.
The 2022 support package included a £650 cost-of-living payment for means-tested benefit claimants, split into two payments, plus payments for people with disabilities, and pensioners.
A £400 energy bill discount for households will continue to run through March.
Recent research from accountancy giant PwC and credit app TotallyMoney indicated that 8.9 million adults are showing signs that their finances are teetering on the brink - meaning that they may need to use their overdraft to cover everyday spending and essentials such as the food shop.
They may also struggle to keep up with repayments on their borrowing in 2023.
More information about the Government's cost-of-living support and what is available is here
The cost of living crisis is affecting many:
Interest rates and inflation go up
Inflation rose by 8.8% in the 12 months to January 2023, down from 9.2% in December 2022. With interest rates also rising to 4%, those saving money will earn more interest on their finances, whilst those paying mortgages would pay more interest to the bank.
Energy bills
The price of energy went up incredibly as the cost of living crisis hit, with the gas price spike caused largely by the war in Ukraine. The price cap - which is set by an independent regulator to help offset costs onto customers - was set to rise to £3,549 for an average home in October but a price freeze from the government restricted the typical bill to £2,500. That's still an increase of 27% from the previous energy cap and as it's a cap on unit cost, the more energy you use the higher your bill will be.
Food prices
The cost of a weekly shop also has gone up as a result of the cost of living crisis. As a result of the war in Ukraine, a number of products including cooking oils and wheat have been disrupted. This means that several products are now considerably more expensive, driving bills up for customers.
Prices at the pumps
The average cost of petrol has also rose to unprecedented levels. Supply lines for petrol have been thrown into doubt as a result of the war in Ukraine, as Russia is a large export partner for gas, oil and fuel. In April 2022, the average price for a litre of petrol on the forecourt was 160.2p, whilst a litre of diesel would cost 170.5p. By late June 2022 the price had risen to an average of 190.9p for a litre of unleaded and 198.9p for a litre of diesel. In March 2023 the price wass on average of 147.03 in petrol and 167.04 in diesel.
Average cost of filling up a car with petrol hits £100
On 9th June 2022, the average cost of filling up a car with petrol hit £100 for the first time ever. Diesel had already hit that milestone. It comes as the cost of fuel hit a record high of one pound eighty a litre. The 2p rise was the biggest daily jump in 17 years. Prices have dropped by at least 20p per litre since the high point.