The Department for Work and Pensions (DWP) has definitively announced it is not planning on making any more cost of living payments.
The cost of living scheme was discontinued last year, with the last installment of the grant issued in February 2024. Nevertheless, people have wondered if it might be making a comeback in light of rising bills and financial pressures.
What were cost of living payments?
Between 2022 and 2024, low-income households received a series of one-off cost of living payments to help with rising energy bills and inflation.
For example, pensioner households were entitled to payments of either £150 or £300 on top of winter fuel payments.
Some eight million families received a cost of living payment of £900, split across three installments.
What financial support will I have access to?
Low-income households will still have access to financial support through the government’s Household Support Fund (HSF), which has been extended by the Labour government until March next year with an extra £742 million of funding.
The HSF is distributed by local councils, who decide how funds should be allocated. Councils are also providing cash grants and energy bill assistance. Residents should check their local council for eligibility criteria and application windows.
In spite of the update, those who claim Universal Credit can expect to receive an extra £150 over the course of 2025. Disability Living Allowance, Carers Allowance, and child benefits are also set to increase by the same amount.
Chancellor of the Exchequer Rachel Reeves said: "With today’s increase in working-age benefits, and our ironclad commitment to pensioners through the Triple Lock, we are making the decisions that support those who need it in Britain, putting money into people’s pockets and delivering our Plan for Change."
Changes are also being made to the Fair Repayment Rate, which sets the amount of money taken off people’s benefits if they’re in debt, to pay back what they owe.
Previously, the maximum amount that could be taken off one’s standard Universal Credit allowance was 25 per cent, but the maximum has now been reduced to 15 percent, which will put an extra £420 on average in some households’ pockets.
