As the cost of fuel, food and energy prices continue to make a huge dent in people's pockets. The government's Cost of Living Payment has been introduced to try to cushion the blow of rising costs with a total of £650 going out to certain households in two payments.
It is estimated that 551,000 families in the East Midlands will be eligible for the payment and about 1 in 4 across England, Scotland, Wales and Northern Ireland. While it has been heavily publicised that the first payment of £326 will be automatically dropping into bank accounts between now and Sunday, July 31, what about the second part of the lump sum?
Work and Pensions Secretary, Thérèse Coffey confirmed: "This first instalment of £326 should reach all eligible low-income households by the end of July." In its latest update on the scheme, the government confirmed that the second instalment, which amounts to £324 will follow from the autumn, with separate payments for pensioners and disabled people also coming later this year.
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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."
It should be noted that households who are eligible for the tax free payments 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.
What we know
- 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.
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- The DWP will make the payment in two lump sums
The first instalment of £326 will automatically go into eligible households between now and the end of the month (Sunday, July 31)
- The second payment will go out 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.
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