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Cost-of-living crisis: Your questions on Chancellor Rishi Sunak's £15bn support package answered


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Rishi Sunak has unveiled a £15 billion package to aid households with the spiralling cost of living.

The Chancellor announced today that each household receive at least £400, with additional grants for those worst off. With the plans laid out, we have attempted to answer some of the questions people will be asking.

Chancellor Rishi Sunak has announced plans to support households amid the cost of living crisis
Chancellor Rishi Sunak has announced plans to support households amid the cost of living crisis

Who gets what in the package?

Every household in England, Scotland and Wales will receive a base payment of £400. Households in Northern Ireland will receive the same amount, but the method of delivering it is still being worked out.

Additionally, anyone on means-tested benefits will be given £650, while pensioners who receive winter fuel payments will recieve £300.

Those who are on non-means-tested disability benefits will get an extra payment of £150.

Mr Sunak said that around eight million of the most vulnerable households will in total receive at least £1,200 this year – although this does include the £150 council tax rebate many will have already been given.

All households will receive at least £400. Stock picture
All households will receive at least £400. Stock picture

What are means-tested benefits?

These are benefits that are available for households who can demonstrate that their means – i.e their income – are low enough to require support.

The grant in this case applies to households on Universal Credit, Tax Credits, Pension Credit and others.

What is a low-income household? And do they all receive the extra £650 grant?

A low-income household, or LIH, is any household whose income is less than 60% of the national median pay.

As of April, there were thought to be around 10.5 million people in low income before housing costs – and 13.4 million after housing costs.

The £650 grant does apply to any household on Universal Credit, for which anyone who is found to be in low income can apply.

What makes household income?

Household income is made up of the incomes of all the adults of a household.

It's not just wages or salaries – it also includes income from rent, investments, welfare and pensions.

Pensioners will reeive an additional £300. Stock Image
Pensioners will reeive an additional £300. Stock Image

I am not in a vulnerable or low-income household. What will I receive?

All households across the UK will receive £400 in October to help towards their energy bills, regardless of their financial status, with no requirement to pay the money back.

This is a notable improvement on the previous plan, which would have seen households provided with a grant of £200, to be repaid in payments of £40 over five years from 2023.

When will I receive my grant?

Those receiving the £400 payment should expect it to be added to their account in October.

Households who receive means-tested benefits will receive their additional £650 in two lump-sum payments; the first starting in July and the second in the autumn.

Pensioners and anyone receiving tax credits will receive their payment shortly after this.

No specific dates have been confirmed, and it is expected to take some time over each month to roll out the payments.

So, if you don't receive your £400 on October 1, don't panic.

Energy companies are set to be hit with a windfall tax. Stock Image
Energy companies are set to be hit with a windfall tax. Stock Image

How will the money be delivered?

The Chancellor was very clear that claiming money would not require "any additional form-filling". This means it will be paid to each household via existing account set-ups.

For anyone paying their energy bill via direct debit or credit, the £400 energy rebate will automatically be credited to the account that pays the bill in October.

If you use pre-pay meters, the money will be applied direct to the meter, or delivered via a voucher.

Any additional sum that a household qualifies for will be sent through the same system their relevant benefits are normally delivered.

Any spare money I have goes to looking after my children. Is there additional support for me?

Unfortunately, there is no specific increase in payments – above the standard £400 – for any household that is not already claiming alternative benefits.

How is the government going to pay for this grant?

A chunk of the £15 billion cost, it is hoped, will be made up by the government levying a 'windfall tax' on oil and gas companies.

The 25% tax on the "extraordinary profits" of the companies, which Mr Sunak labelled an "energy profits levy", is hoped to raise around £5 billion in a year.

This, however, does not cover all of the cost. Electricity generating companies may also be taxed more, but the chancellor is likely to have to dip into other funds.

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