NEWS: Update on Cost of Living payments

The government has confirmed when its new round of Cost of Living payments will be made in 2023 – we’ll take you through the key dates you need to know.

Last year, Rishi Sunak (when he was still Chancellor, remember that?) unveiled his plan for helping the UK’s most vulnerable households get through the current crisis.

The centerpiece of that plan was the Cost of Living package, which saw the government sending money directly to people claiming a range of benefits.

The first bunch of Cost of Living (CoL) payments was made last year, and after Rishi Sunak became prime minister, it was announced that the payments would not only be repeated but boosted for those claiming certain kinds of benefits (such as the eight million people out there claiming Universal Credit). The first CoL payment totalled £600, whereas this year’s CoL payment would be bumped up to £900.

The good thing about these payments is that they’re made directly to bank accounts, and they don’t rely on people having to claim or redeem them (which is turning out to be a huge problem when it comes to energy discount vouchers for those on prepayment meters).

We waited several weeks to find out exactly when these payments would be made. Last week, the government published its updated timetable, which you can find below:

  • £301 – First Cost of Living Payment – during Spring 2023
  • £150 – Disability Payment – during Summer 2023
  • £300 – Second Cost of Living Payment – during Autumn 2023
  • £300 – Pensioner Payment – during Winter 2023/4
  • £299 – Third Cost of Living Payment – during Spring 2024

People claiming the following benefits will qualify for the CoL payments (those claiming housing benefit are not eligible).

  • Universal Credit
  • income-based Jobseeker’s Allowance (JSA)
  • income-related Employment and Support Allowance (ESA)
  • Income Support
  • Pension Credit
  • Child Tax Credit
  • Working Tax Credit

What does this tell us?

Exact timings will be confirmed nearer the time but it’s helpful to know roughly when these payments will be made.

However, it’s worth noting that the £900 payment is actually being split into three chunks, and the last payment won’t be made until next year.

That means people will actually get LESS in 2023 than they did in 2022 (£601 v £650).

How come? This might be because the government is adopting a “wait-and-see” approach. The cost of living crisis might be in the rear view mirror by Spring next year, with the Bank of England predicting that inflation will cool down over the course of 2023. At that point, the government may decide the final payment is not necessary.

However, the Bank of England hasn’t always got its predictions right (not least when it comes to inflation), so it remains to be seen whether this is a shrewd moneysaving tactic or a stingy misfire on the part of the government.

Either way, this latest news really underlines the ongoing importance of checking whether you are eligible for benefits. For instance, it is not necessarily true that workers do not qualify for Universal Credit, and given that the government is concentrating nearly all its future Cost of Living support on those claiming benefits, you should double-check that you’re not missing out. There are three excellent tools offered by entitledto, Turn2us and Policy in Practice that will help you suss out whether you’re eligible.

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