Eight million households on means-tested benefits will receive their final cost of living payment to help with high food and energy bills from Tuesday.
The £299 payment, the last of three instalments that totalled £900, will go directly into people’s bank accounts between now and 22 February, without the need to apply. It is part of the government’s £104bn cost of living support package.
The cost of living payment will benefit more than 680,000 households in Scotland, more than 400,000 in Wales and 300,000 in Northern Ireland on means-tested benefits.
The payments were introduced in 2022 when the then chancellor, Rishi Sunak, announced a payment of £650 in two instalments in May. In November of that year Jeremy Hunt, the chancellor, increased this to £900 across three payments.
The government has no current plans to extend the scheme, but charities have urged it to announce fresh support.
While the inflation rate has eased considerably from double digits, it rose unexpectedly to 4% in December in the first increase for 10 months, and the cost of household gas and electricity remains high, as a result of an energy crisis caused by Russia’s invasion of Ukraine in late February 2022. Rents have spiralled amid a shortage of properties on the market.
Morgan Wild, the interim director of policy at Citizens Advice, said: “Increasingly, people coming to Citizens Advice are living on empty, unable to afford their essential costs and finding themselves in desperate situations.
“Our data shows that the cost of living payments do offer some respite to people, but this is short lived. Historically high energy bills, unaffordable housing and other spiralling costs are keeping people in crisis.
“The government has responded with temporary support but we need more than quick fixes. Long-term commitments are needed to raise people’s incomes and standard of living.”
In November, a report by the cross-party Commons work and pensions committee concluded that the cost of living payments, while welcome, had not been sufficient to address the scale of the problem and offered only a “short-term reprieve” for many people struggling with high inflation and bills.
Commenting on the final payment to be paid out from Tuesday, Mel Stride, the work and pensions secretary, said: “The economy has turned a corner, and with inflation falling we are providing millions of the most vulnerable households with another significant cash boost.”
