Households in Great Britain will get more than £60 off their energy bills each month throughout winter, as the government revealed the details of its cost of living support.
The money, which is part of the Energy Bills Support Scheme, will come in six instalments over six months to around 29 million households. This is separate to the Cost of Living Payment (more on that later).
Back in May, then-Chancellor Rishi Sunak announced the government would be releasing a support package providing a £400 boost for every UK household’s energy bills. The latest announcement is the first detail of how the £400 support will be paid out.
How will you receive the energy bills support?
Every household is eligible for this part of the support package.
Those with a domestic electricity meter point paying for their energy via standard credit, payment card and direct debit will receive an automatic deduction to their bills.
Traditional prepayment meter customers will be provided with Energy Bill Discount Vouchers in the first week of each month, issued via SMS text, email or post, the government confirmed.
Business and Energy Secretary Kwasi Kwarteng said: “People across the country are understandably worried about the global rise in energy costs, and the pressure this is placing on everyday bills.
“While no government can control global gas prices, we have a responsibility to step in where we can and this significant £400 discount on energy bills we’re providing will go some way to help millions of families over the colder months.”
Is the different from the Cost of Living Payment?
Yes. Separate to the £400 fuel support, more than eight million households in the UK are also eligible for a £650 Cost of Living Payment, which you can put towards bills or living costs.
It’s intended for those households already on means-tested benefits. This is when the government gives you a set amount of money based on your income and your capital.
It includes anyone who receives:
Income-based jobseekers allowance
Income-related employment and support allowance
The one-off payment is divided into two parts – a £326 set to arrive between July 14 and the end of the month, and an additional £324 later on in the autumn.
If you have a joint claim with a partner, you will only receive £650 in total.
It is tax free, will not impact the benefit cap and does not impact your current benefits. Everyone will receive the full payment if they are on benefits, even if they only receive the lowest amount possible.
However, if you are outside the income bracket for Universal Credit, these extra grants will not be available to you.
Why tax credits are slightly different
The £650 payment is also available for anyone who receives:
Working tax credit
Child tax credit
While it does still involve receiving money from the government, it is separate from benefits. It means the government reduces the amount you pay in taxes. The scheme is also managed by HMRC, not the work and pensions department.
The £650 payment is therefore slightly different for those who qualify through a one-off payment through tax credit and working tax credit, as both instalments will arrive in autumn and winter.
The government website also explains: “You will not get a payment if you have already received a cost of living payment from HMRC because you were entitled to tax credits.”
How do you apply for the £650 support?
This payment will be issued directly to households on means-tested benefits, and so will arrive automatically in their bank balance.
There is no need to apply.
The payment will only go to those who were entitled to a payment or later found to be entitled to such a payment by May 25, 2022.
What other support is available?
There’s also an extra payment for pensioners of £300 to help pay for winter fuel in November of December. This payment is also automatic.
A one-off disability cost of living payment of £150 is also available for those on means tested benefits, and will be sent to claimants in September.
Both the payments for disabled people and pensioners will come on top of the £650 one-off sum.