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How will I get the £650 cost-of-living payment and £400 energy grant? When is the second cost-of-living payment and £400 energy rebate?
(12 days later)
A first cost-of-living payment of £326 will be paid by the end of July Energy bills are set to rise sharply - prompting calls for the government to offer more help.
Direct payments to help with the soaring cost of living have started being paid into bank accounts - but some people will need to ensure they receive their full entitlement. Some households received a first payment to assist with the soaring cost of living in July, with a second due in the autumn.
The first instalment of payments to those on benefits started being made from 14 July.
Other grants will come later in the year, as part of a mix of broad and targeted support. They will not affect the tax you pay, or the benefits, or tax credits, you get.
Who will get the cost-of-living payment and when?Who will get the cost-of-living payment and when?
A £650 payment will be made to more than eight million low-income households who receive the following benefits: Two payments totalling £650 are being made to more than eight million low-income households who receive the following benefits:
Universal Credit,Universal Credit,
income-based Jobseekers Allowanceincome-based Jobseekers Allowance
income-related Employment and Support Allowance, income-related Employment and Support Allowance
Income SupportIncome Support
working tax creditworking tax credit
child tax creditchild tax credit
pension creditpension credit
This will come in two instalments. The first, of £326 will be paid for most people between 14 and 31 July. The second, of £324, will be paid in the autumn. Those on tax credits will have to wait longer, as the first payment will be in the autumn and the second instalment during the winter. The first instalment of £326 was paid to most people between 14 and 31 July. The second, of £324, will be paid in the autumn - but a date has yet to be set.
They will be paid automatically into bank accounts - usually marked "DWP Cost of Living". Those on tax credits will have to wait longer, as the first payment will be in the autumn and the second during the winter.
The payments are made automatically into bank accounts - usually marked "DWP Cost of Living".
People will not be eligible for the payment if they receive New Style Employment and Support Allowance, contributory Employment and Support Allowance, or New Style Jobseeker's Allowance, unless they get Universal Credit.People will not be eligible for the payment if they receive New Style Employment and Support Allowance, contributory Employment and Support Allowance, or New Style Jobseeker's Allowance, unless they get Universal Credit.
Administrators are using a computer program to identify those eligible. Anyone who feels they are entitled but does not receive it can contact the office that pays your benefit or tax credits to discuss it. Anyone who feels they are entitled to the help but does not receive it can contact the office that pays their benefit or tax credits.
But to be eligible for the first instalment, people must have been entitled to their benefits payments by 25 May. The Department for Work and Pensions says that 850,000 pensioner households are failing to claim Pension Credit to which they are entitled - which is a gateway to these extra payments. Some people who could be missing out. The government says 850,000 pensioner households are failing to claim Pension Credit, which is a gateway to these extra payments.
In fact, it remains possible to get the whole £650 if signed-up to pension credit by 18 August, as you can ask for a pension credit claim to be backdated for up to three months.
Cost-of-living payments are designed to help with soaring energy billsCost-of-living payments are designed to help with soaring energy bills
Other eligibility criteria, including technical details for those on Universal Credit and other benefits are outlined here for people in England, Wales and Scotland, and here for people in Northern Ireland. In a very small number of complicated cases, payments may be made a little later than the end of July. Other eligibility details, including information for those on Universal Credit and other benefits are outlined here for people in England, Wales and Scotland, and here for people in Northern Ireland. In a very small number of complicated cases, payments have been made a little later than the end of July.
Those on disability benefits will receive £150 in September, which may be on top of the £650 payment, because in many cases they have higher energy use. Those on disability benefits will receive £150 from 20 September, which may be on top of the £650 payment, because in many cases they have higher energy use.
Anyone receiving the following benefits will be entitled to the extra £150:Anyone receiving the following benefits will be entitled to the extra £150:
Disability Living Allowance,Disability Living Allowance,
Personal Independence PaymentPersonal Independence Payment
Attendance AllowanceAttendance Allowance
Scottish Disability PaymentsScottish Disability Payments
Armed Forces Independence PaymentArmed Forces Independence Payment
Constant Attendance AllowanceConstant Attendance Allowance
War Pension Mobility SupplementWar Pension Mobility Supplement
None of these payments affect the tax you pay, or the benefits, or tax credits, you get.
How will the £400 energy discount be paid out?How will the £400 energy discount be paid out?
All UK households will get a grant which will reduce energy bills by £400 from October.All UK households will get a grant which will reduce energy bills by £400 from October.
Initially, this was designed to be a £200 reduction paid back in instalments over five years. Now, the discount has been doubled and there is no requirement to repay.Initially, this was designed to be a £200 reduction paid back in instalments over five years. Now, the discount has been doubled and there is no requirement to repay.
In other words, from October, everyone's energy bill will be reduced by £400. This will be applied in monthly instalments over six months, with a reduction of £66 in October and November, and of £67 a month from December to March 2023.In other words, from October, everyone's energy bill will be reduced by £400. This will be applied in monthly instalments over six months, with a reduction of £66 in October and November, and of £67 a month from December to March 2023.
The discount will be made automatically by your energy supplier. There is no need to apply.The discount will be made automatically by your energy supplier. There is no need to apply.
Direct debit and credit customers will have the money credited to their account. Customers with pre-payment meters will have the money applied to their meter or paid via a voucher. Direct debit and credit customers will have the money credited to their account. Customers with pre-payment meters will have the money applied to their meter, or paid via a voucher.
Details of £400 energy bill discount revealed
Why are energy prices going up so much?Why are energy prices going up so much?
Is the UK doing as much on bills as other countries?Is the UK doing as much on bills as other countries?
In technical terms. the grant will apply directly for households in England, Scotland, and Wales. The grant will apply directly for households in England, Scotland, and Wales. Separate arrangements are being made for households in Northern Ireland.
The Treasury is still in discussion with Stormont ministers about how to make the payment to Northern Ireland households.
Northern Ireland is a separately regulated energy market. The situation is further complicated because NI's power sharing government is not fully operating and cannot make new spending decisions.
What extra help will pensioners get for winter fuel bills?What extra help will pensioners get for winter fuel bills?
Households that receive the Winter Fuel Payment - which is worth £200-£300 and is paid to nearly all homes with at least one person of pension age - will receive an additional £300 in November or December.Households that receive the Winter Fuel Payment - which is worth £200-£300 and is paid to nearly all homes with at least one person of pension age - will receive an additional £300 in November or December.
That should cover nearly all pensioners across the UK.That should cover nearly all pensioners across the UK.
Lower-income pensioners, who claim pension credit, will receive the money in addition to the £650 support for those on benefits which is mentioned above.Lower-income pensioners, who claim pension credit, will receive the money in addition to the £650 support for those on benefits which is mentioned above.
So, there is a cumulative effect on some of the support payments being given.
A small group of pensioners with disabilities will receive a total of £1,500 when all the new payments and discounts they are eligible for are added up.A small group of pensioners with disabilities will receive a total of £1,500 when all the new payments and discounts they are eligible for are added up.
What payments are already being received? What payments have already been made?
About 80% of households are already receiving a £150 energy rebate, often through their council tax bill.About 80% of households are already receiving a £150 energy rebate, often through their council tax bill.
The mechanics can differ depending on how you pay your council tax, for example, through direct debit and which part of the country you live in. The mechanics may have differed depending on how you pay your council tax, for example, through direct debit and which part of the country you live in.
Some payments have been made to people with fuel vouchers, for example, through the Household Support Fund distributed by councils.Some payments have been made to people with fuel vouchers, for example, through the Household Support Fund distributed by councils.
How will this be funded?How will this be funded?
A windfall tax - officially called a temporary levy - will be imposed on energy companies (not your domestic supplier) which should raise about £5bn over the next year.A windfall tax - officially called a temporary levy - will be imposed on energy companies (not your domestic supplier) which should raise about £5bn over the next year.
Companies that get oil and gas out of the ground are getting much more money for it than they were last year, partly because demand has increased as the world emerges from the pandemic and partly because of supply concerns due to Russia's invasion of Ukraine. Companies that get oil and gas out of the ground are getting much more money for it than they were last year.
This is partly because demand has increased as the world emerges from Covid and partly because of supply concerns due to Russia's invasion of Ukraine.
Is the government package really worth £37bn?Is the government package really worth £37bn?
Electricity generation companies may also be taxed more in the future.Electricity generation companies may also be taxed more in the future.
The tax will cover some, but not all, of the bill for the Treasury, which means the chancellor will have to dip into other funds. The tax will cover some, but not all, of the bill for the government, which means it will have to dip into other funds.
Will the cost of living still go up?Will the cost of living still go up?
Prices are already rising at a faster rate than at any time in the last 40 years.Prices are already rising at a faster rate than at any time in the last 40 years.
Official forecasters say that the rate is set to accelerate. Prices will not fall next year and beyond, but the rate of increase is expected to slow.Official forecasters say that the rate is set to accelerate. Prices will not fall next year and beyond, but the rate of increase is expected to slow.
The big unknown is what will happen to energy bills in the next few years. That depends to a great extent on the war in Ukraine, and its wider impact on energy supplies from Russia and how that changes the wholesale prices paid by energy suppliers. The big unknown is what will happen to energy bills in the next few years.
That depends to a great extent on the war in Ukraine, and its wider impact on energy supplies from Russia.
Why are prices rising so quickly?Why are prices rising so quickly?
Consultancy Cornwall Insight says that the typical domestic customer is likely to pay £3,244 a year from October, then £3,363 a year from January. The typical bill at present is about £2,000 a year. Consultancy Cornwall Insight says that the typical domestic customer is likely to pay £3,554 a year from October, then £4,650 a year from January. The typical bill at present is about £2,000 a year.
That is a bigger hit to domestic budgets than had been anticipated when the cost-of-living payments were set. For about 19 million of the 23 million households affected in England, Scotland and Wales, the higher cost will be reflected in bigger direct debit demands from their supplier. Prepayment meter users will see a sudden jump from October. That is a bigger hit to domestic budgets than had been anticipated when the cost-of-living payments were set. As the prime minister changes, there will be considerable attention on whether additional support is provided.
Households in Northern Ireland have already faced higher prices where, unlike England, Scotland and Wales, there is no price cap.