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

Zara Crawford
Authored by Zara Crawford
Posted: Thursday, July 14, 2022 - 21:19

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.

  • £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.

Further information

  • Low-income households are benefiting from government support in a variety of different ways. You can read more about the government’s Cost of Living support and what is available on Gov UK.
  • More than 8 million households on benefits will receive a payment of up to £650 this year, made in two instalments. This includes all households entitled to a payment of the following benefits: Universal Credit, Income-based Jobseekers Allowance, Income-related Employment and Support Allowance, Income Support, Working Tax Credit, Child Tax Credit and Pension Credit.
  • The DWP will make the payment in two lump sums – the first from July 2022, the second from the autumn. Payments from HMRC for those on tax credits only will follow shortly after each to avoid duplicate payments.
    • To be eligible for the first instalment, families must have been entitled to a payment (or later found to be entitled to a payment) of either:
      • Universal Credit for an assessment period that ended in the period 26 April 2022 to 25 May 2022
      • income-based JSA, income-related ESA, Income Support or Pension Credit for any day in the period 26 April 2022 to 25 May 2022
    • Tax credit-only customers, who will receive the first instalment in the Autumn, must have received a payment, or an annual award of at least £26, of tax credits for any day in the period 26 April 2022 to 25 May 2022.
    • This payment will be tax-free, will not count towards the benefit cap, and will not have any impact on existing benefit awards.
    • These lump sums will be delivered in two slightly different payments of £326 and £324. The distinct value relates to a specific qualifying period, so it is simpler to determine if a payee received the correct payments, reducing the fraud risk of people who claim not to have had one of the specific two payments, as DWP will be able to clearly track those who have.

 

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From: Department for Work and Pensions and The Rt Hon Thérèse Coffey MP

Published 14 July 2022

 

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