How much will I get from the Government’s cost of living support package?

Last week Chancellor Rishi Sunak stood up in the House of Commons and announced a cost of living support package. It included help for households on low incomes, pensioners and disabled people along with a £400 energy discount for all UK households.

This comes at a time where families are increasingly concerned about how much their energy bills will cost when the energy price cap is predicted to rise in October.

Sarah Coles, Senior Personal Finance Analyst with Hargreaves Lansdown, says: “The government has offered a lifeline to millions of people struggling to keep their head above water.

“There’s no doubt that this will help keep many families afloat, especially those in the most desperate circumstances, some of whom will see state support that matches the rising cost of energy”.

How much will I get as part of the cost of living support package?

There is up to £1,500 per household available, but whether you get this maximum amount will depend on your circumstances. Some people will get more money than others - as you may qualify for more than one of the payments listed below.

• Every household will get a £400 energy discount which will be credited to their bill in October. Unlike the £200 energy grant that was originally proposed, this £400 payment won’t have to be repaid - so it’s free cash.
• More than eight million low income households will get a one off £650 payment – paid in two instalments to those claiming means tested benefits and tax credits.
• Around eight million pensioners who get the Winter Fuel Payment will get an extra £300 in the Autumn to help with rising energy bills.
• Around six million disabled people will get an extra £150 if they claim certain disability benefits.

Talking about the Chancellor’s cost of living support package, MoneySavingExpert Martin Lewis, said in an interview with Channel 4 News that, “it will never be enough, but I think this will go a long way to helping many people”.

Am I eligible for the low income payment?

Over eight million low income households will automatically get this one off £650 payment. These payments will be tax free and won’t affect your benefit cap or the level of any other benefits you receive. The payment will be made in two instalments. To qualify for the first instalment, you need to be claiming the following means-tested benefits or tax credits between 26 April 2022 and 25 May 2022:

• Child Tax Credit
• Income-based jobseeker's allowance
• Income-related employment and support allowance
• Income support
• Pension credit
• Universal credit
• Working tax credit

This £650 payment will also be paid to those who applied for means-tested benefits on, or before 25 May 2022, and whose claim is successful.

The second cost of living payment will be made between 8 and 23 November. To qualify for the second payment, you need to have been claiming the above benefits (or later found to qualify) for an assessment period that ended between 26 August 2022 and 25 September 2022. 

Who will get the £150 disability payment?

Six million people will get a £150 disability payment as part of the cost of living support package. This will be a one off, tax free ‘top up’ payment, that won’t affect your benefits cap, or any other benefits you receive. It will be paid automatically, with no need to apply, to disabled people who claim, or are in the process of claiming certain disability benefits, as of 25 May 2022.

Here is a list of benefits you need to be claiming or applying for:

• Disability Living Allowance
• Personal Independence Payment
• Attendance Allowance
• Scottish Disability Benefits
• Armed Forces Independence Payment
• Constant Attendance Allowance
• War Pension Mobility Supplement.

Payment will be made directly to your bank account, or the account your benefits are paid into during September.

Those eligible for this extra £150 payment, may also qualify for the £650 payment, which along with the £400 energy discount means an extra £1200.

Pensioners get an extra £300 from the cost of living support package

Over eight million households with a pensioner who receives the Winter Fuel Payment, will get an extra £300 towards their energy bills this winter. This may be paid in addition to any of the other cost of living payments, including the £650 payment, providing you qualify.

Payments will be made automatically, with no need to apply, and made to those who are over state pension age between 19 – 25 September 2022.

£400 energy rebate for all households

Around 28 million UK households will get a £400 energy rebate on their energy bills from October. The money will be credited to your energy bill. For anyone using pre-payment meters, will be applied to your meter or you will be given a voucher.

This new £400 payment replaces the previously planned £200 energy loan. The £200 energy loan was due to be repaid, but has now been scrapped. You now get double the money, with the £400 energy discount, which is free cash as the money does not need to be repaid.

£500 million boost to Household Support Fund

The Household Support fund is a pot of money dished out by local councils to help the most vulnerable households. This includes those who are struggling with spiralling household bills or slipped through the cracks of any Government support.

The Chancellor is now giving an extra £500 million to the Household Support Fund – which brings the total fund to £1.5 billion. The scheme is also being extended from October through to March 2023.