Rishi Sunak is planning to give eight million households cost of living payments worth up to £1,100 as part of his autumn statement, it was reported today.
The prime minister and chancellor, Jeremy Hunt, is expected to provide up to three additional financial boosts for some families: these include a cost of living payment worth £650, £150 for disabled people and £300 for some of the poorest pensioners.
These will be a continuation of the payments that many households will have already received since September to cover the cost of rising food and energy costs, according to The Times.
Mr Sunak has vowed to put ‘fairness and compassion’ at the heart of ‘all the decisions we make’ in the autumn statement, adding: ‘I am confident people will see that [on] Thursday.’
Speaking at the G20 in Bali he said ‘understands the particular challenge of pensioners’ and they will ‘always be at the forefront of my mind’.
Below, we look at who will be entitled to the cost of living handouts set to be announced on Thursday, how they will be paid, and how much you can expect to receive in total.
Who will be eligible for £650 cost of living payments?
If you claim some benefits, you might be eligible for an additional £650 from the UK Government after the Autumn Statement.
This includes all households receiving universal credit; income-based jobseekers allowance; income-related employment and support allowance; income support; working tax credit; child tax credit; and pension credit.
Do I need to apply?
Households would not need to apply for the grant as those eligible have automatically been identified by HMRC and the DWP.
When are they set to be paid?
Previously it was spread over two payments. If it follows the same model the first payment will be for £326, and the second payment of £324 will be paid later, probably by the spring of 2023.
DISABILITY COST OF LIVING PAYMENT – £150
Who qualifies?
Around six million people across the UK who receive a disability benefit are set to receive a one-off payment of £150 at some point this winter.
The benefits required to claim the payment are: the Disability Living Allowance; Personal Independence Payment; Attendance Allowance; Scottish Disability Benefits; Armed Forces Independence Payment; Constant Attendance Allowance; or the War Pension Mobility Supplement.
Previously, the Government said the money recognised the fact that people with disabilities ‘may face a wide range of additional costs, such as specialist equipment, specialist food, and increased transport costs, and this payment will help with these costs as they are likely to have increased’.
How will it be paid?
The payment would be made directly to eligible people across the UK.
They will be exempt from tax, will not count towards the benefit cap, and will not have any impact on existing benefit awards.
PENSIONER COST OF LIVING PAYMENT – £300
Who qualifies?
If you’re entitled to a Winter Fuel Payments for winter 2022 to 2023, you may get an extra £300 for your household paid with your normal payment.
This would be in addition to any Cost of Living Payment you get with your benefit or tax credits.
The cash will also be paid on top of any other one-off support a pensioner household is entitled to, such as where they are on pension credit or receive disability benefits.
The Winter Fuel Payment and the Pensioner Cost of Living Payment are both not taxable and do not affect eligibility for other benefits.
How will it be paid?
Pensioners receive their Winter Fuel Payment in November or December – meaning the living payments may coincide with this. For most pensioner households, this is be paid by direct debit.
People will be eligible for this payment if they are over State Pension age (aged 66 or above). The Government will make these payments directly to households across the UK.
However, there are certain circumstances where an individual above State Pension age does not qualify for the Winter Fuel Payment which can be found on the Government website.
Rishi’s cost of living boost for hard up Britons: Sunak will give eight million households support worth up to £1,100 and increase national living wage by nearly 10% to £10.40 as he prioritises poorest in Autumn Statement
By Martin Robinson, Chief Reporter
Rishi Sunak will announce a big rise in the national living wage and also give eight million households cost of living payments worth up to £1,100, it was claimed today.
The Prime Minister is set to prioritise support for the poorest people as he also signalled that he will keep the triple lock on pensions as part of Thursday’s Budget.
Mr Sunak and Chancellor Jeremy Hunt plan to increase the living wage from £9.50 an hour to about £10.40 an hour – or more – raising wages for 2.5million people, according to The Times.
The PM is also now expected to increase benefits, such as universal credit, as well as providing up to three additional financial boosts for some families: these include a cost of living payment worth £650, £150 for the disabled and £300 for some of the poorest pensioners. It means some homes could get payments of £1,100 this winter.
These will be a continuation of the payments that many households will have already received since September to cover the cost of rising food and energy costs.
The Prime Minister said at the G20 in Bali that he ‘understands the particular challenge of pensioners’ and they will ‘always be at the forefront of my mind’.
The triple lock, introduced in 2010, guarantees that the state pension will rise in line with either inflation, earnings or 2.5 per cent, whichever is the highest.
But with inflation near 10 per cent, the Treasury could save around £4.5billion a year if it raised pensions in line with wages – now around 5.5 per cent – instead.
Asked whether he will abandon the triple lock, Mr Sunak, who is attending the G20 summit, said: ‘My track record as Chancellor shows I care very much about pensioners.
Rishi Sunak (pictured today with Justin Trudeau in Bali) will raise benefits and has signalled that he will keep the triple lock as part of Thursday’s Budget
‘I can’t comment on any decisions… days before a financial statement. But we will put fairness and compassion at the heart of all the decisions we make.
‘I am confident people will see that [on] Thursday.’
Senior Conservatives have warned that abandoning the triple lock would be seen by pensioners as a betrayal and could be ‘political suicide’ given that many older people vote Conservative.
The 2019 Tory manifesto pledged to keep the protection in place for the duration of this Parliament.
Mr Sunak suspended it this year because of a freak rise in average wages linked to the end of lockdown after the Covid-19 pandemic, meaning pensioners received an increase of just 3.1 per cent.
Separately the PM has given his strongest indication that he will ditch the target of spending 3 per cent of GDP on defence by 2030.
Asked twice whether he would retain the target yesterday, he refused to commit to it, saying Britain’s global reputation for investing in defence was already ‘very, very strong’.
He also appeared to dismiss the idea that the defence budget should rise in line with inflation despite the war in Ukraine and growing threat posed by China.
It means a real-terms spending cut, raising fears among some Tory MPs that soldiers will be sold short and the Conservatives could lose their reputation as the party of defence.
The defence budget is expected to rise in cash terms from £47.9billion this year to £48billion in 2023 and £48.6billion in 2024.
Inflation is eating into the budget and could even lead to the Tories breaching their election manifesto, which pledged to ‘increase the budget by at least 0.5 per cent above inflation every year of the new Parliament.
But council tax is set to soar above £2,000 for the first time ever as millions of families face fresh financial agony under new Government plans.
But the average household will be forced to fork out more than £2,000-a-year on council tax for the first time under Rishi Sunak and Jeremy Hunt’s (pictured together) new plans
Rishi Sunak and his Chancellor Jeremy Hunt are poised to lift the decade-long cap on increases, amid warnings that hundreds of local authorities could go bust.
Households will face an average £100 hike in council tax per month under the new plans to allow town halls to help fund social care.
Homeowners in the top Band H could even pay as much as £200 extra, with their bills surpassing £4,000, the Telegraph reports.
Rises of more than 2 per cent are currently banned unless they win approval in a local referendum. In recent years town halls have been allowed to raise an additional 1 per cent to pay for social care, making a total of 3 per cent.
But a government source said ministers were looking to relax the rules next year and let councils hike taxes by a total of up to 5 per cent. The source said that giving town halls more ‘flexibility’ to raise money would ease the pressure to increase central funding.
‘Councils are facing pressure on social care, and the social care levy, which would have raised money to help, has gone,’ the source said. ‘So there is a case for allowing councils more flexibility where they can make the case for it locally.
‘But we would still be talking about increases below inflation – no-one is talking about returning to the sort of rises we saw under Labour.’ A 5 per cent rise on an average Band D bill of £1,966 would cost an extra £98 next year.
The move is likely to be announced by Mr Hunt in Thursday’s Budget. But Whitehall sources said wrangling was continuing within Government over exactly how much flexibility to allow.
Council tax to soar above £2,000 for the first time: Millions of families face fresh financial agony as Jeremy Hunt prepares to let town halls add £100 extra to bills in his budget
Council tax is set to soar above £2,000 for the first time ever as millions of families face fresh financial agony under new Government plans.
Rishi Sunak and his Chancellor Jeremy Hunt are poised to lift the decade-long cap on increases, amid warnings that hundreds of local authorities could go bust.
Households will face an average £100 hike in council tax per month under the new plans to allow town halls to help fund social care.
Homeowners in the top Band H could even pay as much as £200 extra, with their bills surpassing £4,000, the Telegraph reports.
Rises of more than 2 per cent are currently banned unless they win approval in a local referendum. In recent years town halls have been allowed to raise an additional 1 per cent to pay for social care, making a total of 3 per cent.
But a government source said ministers were looking to relax the rules next year and let councils hike taxes by a total of up to 5 per cent. The source said that giving town halls more ‘flexibility’ to raise money would ease the pressure to increase central funding.
‘Councils are facing pressure on social care, and the social care levy, which would have raised money to help, has gone,’ the source said. ‘So there is a case for allowing councils more flexibility where they can make the case for it locally.
‘But we would still be talking about increases below inflation – no-one is talking about returning to the sort of rises we saw under Labour.’ A 5 per cent rise on an average Band D bill of £1,966 would cost an extra £98 next year.
The average household will be forced to fork out more than £2,000-a-year on council tax for the first time under Rishi Sunak and Jeremy Hunt’s (pictured together) new plans
The move is likely to be announced by Mr Hunt in Thursday’s Budget. But Whitehall sources said wrangling was continuing within Government over exactly how much flexibility to allow.
Some ministers are resisting the move, arguing that it would pile pressure on families already facing the worst cost of living crisis in decades. But councils are pushing for the freedom to set their own bills without constraint, arguing that their ability to provide core services is being eroded by inflation.
The Local Government Association has warned that councils face a £3.4billion funding gap next year ‘just to maintain services at pre-Covid levels’. It told the Treasury that to fill the gap using council tax alone, bills ‘would have to increase by well over 10 per cent next year’.
A survey by the County Councils Network last week warned that almost four-fifths of authorities fear they could go bust next year without further funding.
A five per cent rise on an average Band D bill of £1,966 would cost an extra £98 next year
Council tax referendums were introduced by the coalition government in 2012 following years of inflation-busting rises under the previous Labour administration.
Sources said the referendum requirement would be kept in place, but only for increases of 5 per cent or above. It comes as a survey due out today by care association Adass reveals that 94 per cent of social care directors believe their service does not have enough staff or resources to get through the winter.
Adass chief executive Cathie Williams said the sector ‘desperately’ needs emergency funding, noting that £500million pledged in September to support hospital discharges has not yet been allocated.
A survey found that more than nine in ten social care directors felt their area did not have enough staff or funding to get through winter as they call on increased resources to prevent people dying early.
But the hike in council tax will be the latest cost-of-living blow for struggling families and pensioners, who are reportedly coming out of retirement due to economic fears.
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