DWP: One in four families get first government Cost of Living Payment from today

Almost one in four families across England, Wales, Scotland and Northern Ireland will get £326 sent directly to them from today, with the second instalment of £324 sent later this year as part of the government’s £37 billion support package.

DWP press release (14 July 2022)

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  • £326 – the first of two cost of living payments – will automatically hit seven million bank accounts between today and 31 July 2022 as part of the government’s £37 billion support package
  • Second instalment of £324 will follow from the autumn, with separate payments for pensioners and disabled people also coming later this year
  • Tax credit claimants will receive their first cost of living instalment by autumn

Over eight million households on means-tested benefits will automatically get the first instalment of £326 from this month.

This means that, combined with other support, millions of low-income households across the UK will receive at least £1,200 from the government by Christmas to ease Cost of Living pressures.

On top of that, nearly one in ten people will get the £150 disability payment this Autumn, and over 8 million pensioner households could get an extra £300 from Winter Fuel Payments in November and December.

Prime Minister Boris Johnson said:

Just as we looked after people during lockdown, we will help them get through these tough economic times.

Today’s payment is the signal to millions of families that we are on their side and we have already promised more cash in the autumn, alongside other measures – including our Help for Households – to support the vulnerable and ease the burden.

Work and Pensions Secretary, Thérèse Coffey said:

Our help for households will begin landing in bank accounts today as we make sure those on the lowest incomes get the support they need in the face of rising costs.

This first instalment of £326 should reach all eligible low-income households by the end of July.

Chancellor of the Exchequer, Nadhim Zahawi said:

It’s great that millions of the families who are most in need are starting to receive their Cost of Living Payments, which I know will be a massive help for people who are struggling.

Alongside tax cuts, changes to Universal Credit and the Household Support Fund, these payments are a vital part of our £37 billion support package to help people deal with rising prices.

Most people entitled to the first instalment of our Cost of Living payment will receive it between now and 31 July 2022. Households who are eligible because they receive tax credits and no other eligible benefits will receive their first instalment from HMRC in the autumn, and the second instalment in the winter. DWP will administer payments for customers on all other eligible means-tested benefits, and customers do not need to contact the government or apply for the payment at any stage.

In addition to the £650 Cost of Living Payment, all domestic energy customers in the UK will receive a £400 grant to help with energy bills, and those in Council Tax bands A-D in England will get an extra £150, which has already been sent to many households. This brings support for millions to £1,200 by the end of the year.

The disability and pensioner payments come in addition to this, as does any support from the Household Support Fund, which was recently extended through to March 2023 with £421 million additional funding. It is now worth £1.263 billion, and combined with £237 million for devolved nations, means this support package now stands at £1.5 billion. The Household Support Fund is designed to help low-income households in England with food and energy bills, and is distributed by local authorities, who know their areas best.

Total government support this year for low-income families stands at £37 billion, a figure which includes a recent rise to £12,570 for the National Insurance starting thresholds. This will benefit 30 million working people and is worth £330 to a typical employee.

 

Confronting the cost of living crisis: How funders can mobilise

New Resource from New Philanthropy Capital (NPC).

The cost of living crisis is as big a crisis as covid, possibly bigger. We need the kind of mobilisation among funders that we saw at the start of the pandemic, yet right now we’re not seeing this. Now is not the time to watch and wait. Destitute people can’t wait. So for philanthropists, it’s time to get on and give.

When the pandemic first hit, NPC was quick to respond with a philanthropy guide on how to keep charities serving. Now, as this new cost of living crisis engulfs an already battered sector, we’re drawing upon everything we’re seeing in the sector and what we’re learning from the charities and funders we work with to advise on how needs are changing, and the new complexities facing the charities who seek to meet them. We’re also compiling data through our Local needs databank, to help inform your decision-making.

We hope this guide helps you to understand the pressures facing people in poverty in Britain, and how to fund effectively to help charities adapt.

In this guide:

Read more and download the full report here. 

Four out of five households face spending cuts as rising cost of living squeezes budgets

Households across the UK are facing spending cuts with two thirds facing a struggle to pay energy bills and more than half worried about affording food, according to recent polling. 

YouGov research commissioned by the Seetec Group, an employee-owned public services provider in the employability, skills and justice fields, found that four out of five (84%) of households had already made cuts to their spending (56%) or expected to make cuts (28%).

As the cost of living crisis starts to bite, one third (36%) said they were struggling to afford energy bills, while another third (35%) said they expected to struggle soon.

Food costs were also posing problems, especially for those in receipt of benefits. A quarter (28%) of respondents who are currently claiming benefits said they are currently struggling to afford food, but are getting by, with a further 30% of the same group saying they expect to struggle with food bills soon.

The research was carried out for Seetec by YouGov, who polled 1,739 adults across Great Britain in early June.

Asked about the most effective government response to help them cope with the cost of living, two thirds (67%) cited measures to help with fuel costs, with three out of five (62%) citing an annual grant to help with energy bills. Nearly half (48%) called for a low

ering of taxes or National Insurance.

Worryingly, a quarter (25%) said recent Government measures aimed at helping low-income households and providing support with energy bills would not help them with the rising cost of living.

Pessimism about the future was also high. 49% of those who have already made cuts to their usual spending, or expect to do so soon, believe this situation will last for another one to five years (35% 1-2 years, 14% 3-5 years).

John Baumback, Seetec Group CEO, commented: “The rising cost of living is swelling the numbers of individuals and families who are struggling to make ends meet, with profound consequences for the life chances of those on low incomes and benefits. It also threatens those communities the government wants to enhance opportunities for in the future, as part of its Levelling Up agenda.

“Our research lays bare the scale of this crisis, but if the Government continues to take action now it could help to further mitigate the impact of a looming recession on the poorest in society.”

In response to YouGov’s findings, the Seetec Group makes a series of recommendations to the Government to ease the cost of living for those on low incomes across the UK.

Seetec’s recommendations include: 

  • Reduce the Universal Credit taper rate further to below 55p to help those in low-paid jobs to top up their wages to make ends meet.
  • Restore the temporary £20 uplift to Universal Credit permanently into the standard rate for current and future claimants.
  • Extend 30 hours free childcare, currently available for three-year-olds, to children from nine-months-old, helping more parents, and particularly women, to return to the workforce.
  • Increase funding for primary and secondary school breakfast clubs from £24 million to £500 million, making this option available to all schoolchildren – supporting parents to work and ensuring the poorest children receive a morning meal.
  • Resurrect the planned Employment Bill, including measures to boost flexible and hybrid working, and appoint a dedicated Minister for the Cost of Living to navigate Departmental boundaries and ensure a more co-ordinated response to the crisis.

Seetec has prepared a pamphlet highlighting the key issues facing those on benefits and low incomes and outlining its recommendations. It quotes participants on its employability, skills and justice programmes, with a particular focus on the South West, highlighting the real difficulties they face in escaping the poverty trap – from unaffordable childcare costs and a shortage of nursery places to rising transport costs and a lack of reliable digital access.

Seetec’s report is available here.


Notes to Editors: 

All figures, unless otherwise stated, are from YouGov Plc. Total sample size was 1,739 adults. Fieldwork was undertaken between 9th – 10th June 2022. The survey was carried out online. The figures have been weighted and are representative of all GB adults (aged 18+).

For further information or the opportunity to interview a senior Seetec spokesperson, please contact Rocky Lorusso, 07955 441558 / rocky.lorusso@seetec.co.uk