Campaigners are calling on the government to boost payments of Universal Credit and legacy benefits by at least £25 a week, to help families through the cost of living crisis. The energy cap increase has been confirmed to rise to £3,549 per year for dual fuel in an average household from October 2022, and welfare organisations are demanding an immediate national response.
Many campaigners that the current situation is an emergency as severe as when the pandemic hit the UK. In October 2021, a Universal Credit top-up of £20 a week was cut after being in place for 18 months, which equated to an extra £1,560 to help households reports Birmingham Live.
This led to people on three other benefits going to the Court of Appeal to try and win back pay of the same amount. Thomas Lawson, chief executive of national poverty charity Turn2us, said the "meteoric rise in the energy cap will cripple those of us in the UK already struggling to stay afloat."
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"This is no longer a choice between heating and eating, but not being able to afford either. This is as big an emergency as the impact of Covid and needs a similarly confident government response.
"As one of the wealthiest economies, it’s simply not acceptable to consign more than a quarter of us into poverty."
The charity is calling on the Government to act now and introduce a cap on energy costs and increase the value of Universal Credit and legacy benefits by a minimum of £25 a week.
Others are asking for action too, including the fuel poverty charity, National Energy Action, who estimate that the rise will increase the number of UK households in fuel poverty from 4.5 million last October to 8.9 million this October. That's even when the Government's support package has been taken into account.
Adam Scorer, National Energy Action chief executive, said: "The scale of harm caused by these price rises needs to sink in. A warm home this winter will be a pipedream for millions as they are priced out of a decent and healthy quality of life.
"The Government needs to immediately upgrade the household support package it first announced back in May. Households need money in their pockets to weather this storm or we are going to see millions in dangerously cold homes, suffering in misery with unimaginable debt and ill health."
However, analysts at Cornwall Insight have warned that October's energy rise will not be the end of it. They have forecasted that prices will rise from £3,549 in October to £5,387 in January when the next price cap review comes into effect, a 52 per cent increase, and then to £6,616 in April, up another 23 per cent.
That would take the average monthly bill from £296 in October, already up from £164, to £449 in January and £551 in April. Chancellor Nadhim Zahawi said the Government is "working flat out" to develop a new package of support for consumers.
He said: "This will mean the incoming Prime Minister can hit the ground running and deliver support to those who need it most, as soon as possible." Current cost of living measures from the Government include £650 for people on Universal Credit and six legacy benefits.
You should get two lump sums of £326 and £324 if you get payments of Universal Credit, income-based Jobseeker's Allowance, income-related Employment and Support Allowance, Income Support, Pension Credit, Child Tax Credit and Working Tax Credit.
People on health and disability benefits will also receive £150 this September. A DWP spokesperson told BirminghamLive that: "We recognise people are struggling with rising prices which is why we are protecting the eight million most vulnerable families with at least £1,200 of direct payments, starting with the £326 cost of living payment being distributed for the summer holidays.
"Through our £37billion support package we are saving the typical employee over £330 a year through a tax cut, allowing people on Universal Credit to keep £1,000 more of what they earn while 80 per cent of households are getting a £150 council tax rebate."
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