In April the price cap jumped almost 60%, from £1,227 to £1,971. The latest increase, announced by Ofgem on Friday, means annual energy bills will almost triple in just six months. About 24 million households in total, including 4.5 million households using prepaid meters, will be affected by the increases. The government has introduced several support measures to help tackle the cost of living crisis, including a £400 grant to help people with energy bills from October and a one-off £150 council tax discount for households living in council tax AD zones. Here’s everything you need to know.
What is the cost of living?
The £650 Living Cost Grant is paid in two installments to all households on means-tested benefits. It is payable in two installments of £326 and £324. The Department for Work and Pensions (DWP) said the delay was made to avoid double payments. The grant is tax-free for all eligible groups and will not affect the benefit cap or existing benefits. You do not need to apply for the grant. Eligible people should see payments appear automatically in their bank accounts, with the code “DWP COL” or similar. The reason the two payments are slightly unequal is “to minimize the risks of fraud by those who may seek to exploit this system”, the government said.
More from the News
Who can claim the £650 COL grant?
In line with Government guidance, the payment is offered to all households on means-tested benefits, including those receiving the following:
Universal credit Income-based Jobseeker’s Allowance Income-related Employment and Support Allowance Income support Employment tax credit Child tax credit Pension credit
He advised that claimants must have received one of these benefits, or started a successful claim, by Wednesday 25 May. Means-tested benefits are awarded based on your income and the amount of capital you have – if someone can prove their income and capital are below a certain level, they qualify. More instructions can be found here.
When is the next cost of living payment?
For people who qualify through means-tested benefits, the first installment of £650 started landing automatically in bank accounts from Thursday 14 July onwards. The government has announced that the second and final payment will be issued to these claimants in the autumn, with an exact date yet to be confirmed. A week after payments began, the government said more than 7.2 million cost-of-living payments had been made, totaling £2.4 billion, adding: “Eligible claimants who have not yet received their payment should not are concerned as the DWP expects some Payments may take up to 31 July 2022 to complete.” But welfare minister David Rutley had warned before the rollout that some payments might not arrive before the end of the month, explaining the grants would be staggered due to demand. Those who qualify solely for Child Tax Credit and Working Tax Credit will have to wait until the autumn for the first instalment, with an exact date yet to be decided. The second payment for these claimants will arrive in the winter, with further details again to be confirmed. The Department for Work and Pensions (DWP) explained: “Payments from HMRC for those in receipt of tax credits only will follow shortly after each to avoid double payments.”
What if my payment is missing?
The DWP has given the following reasons why your payment may be delayed:
You are still waiting for a decision on your claim or appeal for benefits – if you qualify, you will receive the payment later. The payment has not yet been made to you – for example, if you receive tax credits, you will not receive your first cost of living payment until autumn 2022.
If you think you should have received your payment but it hasn’t appeared in your account yet, you can report it as missing. You can do this on the government website here. You will need your National Insurance number.
What other support is offered?
Energy grant £400
The £400 energy payment is made to every household in the country, without means testing. Initially, the plan was for households to receive a £200 discount on their energy bills in October, which would then be paid back over five years from 2023, with customers paying an extra £40 on their bills each year. However, at the end of May – and after much criticism – the then chancellor Rishi Sunak announced that the discount would be increased to £400 and would no longer have to be refunded. The £400 rebate will start in October and will be paid to consumers in installments over six months, with grants administered through energy suppliers. The discount will be broken down into installments of £66 in October and November, rising to £67 per month from December to March 2023. It will be provided on a monthly basis, regardless of whether people pay bills monthly or quarterly or have an associated payment card. Those with a domestic electricity meter point who make payments by payment, standard credit and direct debit cards will receive an automatic discount on bills. People who use prepaid meters and top up their credit before using energy will receive discount vouchers in the first week of each month. These will be sent by text, email or post with the most up-to-date contact details customers have left with suppliers. The discount also applies to students and other tenants who rent properties on residential electricity contracts from landlords, where fixed energy costs are included in the rental charges. In these cases, landlords who resell energy to their tenants will need to pass on the rebate payments appropriately, in line with Ofgem’s tenant protection rules. In all cases, no household should be asked for bank details at any point. Ministers are urging consumers to remain vigilant about possible scams and to report them to the relevant authorities where they are suspected.
£300 winter fuel payment
Most pensioners will already be familiar with the Winter Fuel Payment, an annual tax-free lump sum issued by the DWP. This year, the Government is adding an extra £300 to boost support for more than eight million pensioner households. The winter fuel payment will be available for households that include people born on or before September 25, 1956. You must also live in the UK for at least one day per week from Monday 19 to Sunday 25 September 2022. If you do not live in the UK during the qualifying week, you may receive the payment if both of the following apply:
You live in Switzerland or a country in the European Economic Area (EEA). You have a genuine and sufficient link with the UK – this can include having lived or worked in the UK and having family in the UK.
You can’t get the payment if you live in Cyprus, France, Gibraltar, Greece, Malta, Portugal or Spain because the average winter temperature is higher than the warmest part of the UK. You don’t usually need to apply for the Winter Fuel Payment if you qualify. You should receive the money automatically. However, if you haven’t had the payment in the past, you will need to claim if any of the following apply:
You don’t get benefits or a state pension. You only get Housing Benefit, Council Tax Reduction, Child Benefit or Universal Credit. You receive benefits or a state pension but live in Switzerland or an EEA country.
Contact the Winter Fuel Payment Scheme online or by phone or post if you would like to inquire further or make changes to your payments. You can find the claimant form on the DWP website here. Applications will be accepted until March 31, 2023. The government said the £300 payment should be made to pensioners by autumn 2022. You will receive a letter telling you how much you will receive and an estimated payment date. You must be paid no later than January 13, 2023.
Disability Allowance £150
People on disability benefits may be entitled to a living costs payment of £150 if they receive any of the following:
Attendance Allowance Continuous attendance allowance Disability Living Allowance for adults Disability Living Allowance for children Personal Independence Payment (PIP) Adult Disability Allowance (in Scotland) Child Disability Allowance (in Scotland) Armed Forces independence pay War Pension Mobility Supplement
You must have received payment for one of these eligible benefits by May 25, 2022. If you receive special disability benefit from the Ministry of Defense (MoD) and special disability benefit from the Department for Work and Pensions (DWP), you will only receive payment from the DWP. Around 6 million people are eligible for the payment, the DWP said. The grant will start to be paid automatically from Tuesday 20 September. You don’t need to apply. The DWP said the vast majority of beneficiaries “are expected to receive their lump sum payment within two weeks by early October”. Payments will be made to people receiving special disability from the DWP before those receiving it from the MoD. The £150 disability payment is tax-free and will not count towards your benefit limit or affect any existing benefits you are currently claiming.
