MILLIONS of households on benefits, including Universal Credit, will see their payments rise by up to £470 next year.
Jeremy Hunt confirmed benefit payments will rise in line with inflation in today’s Autumn Statement.
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Millions on benefits to get big pay rise next yearCredit: Alamy
The increase in payments will come into effect in April 2024, and the average family on Universal Credit will be around £470 a year better off.
Mr Hunt said: “Firstly, for those on the lowest incomes. I understand the concerns some have about the effect of adjusting benefit increases to inflation on incentives to work.
“I know there’s been some speculation that we’re going to increase the allowances next year for lower inflation in October.
“But cost-of-living pressures remain greatest for the poorest families.
“Instead, the government has decided to increase Universal Credit and other benefits from next April by 6.7% in line with September inflation, an average increase of £470 for 5.5 million households next year.
“Vital support for those on the lowest incomes from a compassionate Conservative government.”
In his autumn statement, Jeremy Hunt announced:
The Department for Work and Pensions (DWP) usually uses inflation data from September to decide whether to increase benefits and pensions from next April.
However, there were concerns that the government was planning to use the lower inflation figure to increase social benefits.
The annual inflation rate for September was 6.7%, compared to 4.6% for October.
But Jeremy Hunt has now committed to using September’s inflation figure as usual.
Pensioners are also set to get a big pay rise as the chancellor is expected to confirm the triple lock will remain unchanged.
While the increase in benefits will be welcomed by millions of households, claimants face tougher work assessments.
It’s part of a massive return-to-work campaign with a record 2.6 million people on long-term sick leave.
At worst, offenders will lose part of their benefits due to sanctions.
How will Universal Credit payments increase?
There are more than five million people claiming Universal Credit.
The current standard allowance for individual UC applicants under the age of 25 is £292.11 per month.
This will rise by 6.7% to £311.68 – an increase of £19.57.
The standard benefit for single people over 25 is £368.74 per month.
This means that payments will increase by £24.71 a month to £393.45.
If you live with your partner and you are both under 25, your monthly payment will increase from £458.51 to £489.23 – an increase of £30.72.
If you live with your partner and one of you is aged 25 or over, you could see an increase of £38.78 from £578.82 to £617.60 a month.
Of course, how much extra you’ll get per month depends on your current benefit level.
To calculate yours, simply multiply your monthly fee amount by 1.067.
The following are legally required to increase their payments in line with the inflation rate from the previous September each April:
But in documents released alongside the Autumn Statement, the Chancellor also confirmed that Blind Persons’ Allowance (BPA) and Married Couples’ Allowance (MCA) would also rise.
They will also increase by September’s consumer price index of 6.7%.
The BPA will be valued at £3,070 and the MCA between £4,280 and £11,080.
How to get help now
If you’re struggling with rising costs and bills right now, help is available.
For example, you may be entitled to living expenses payments of up to £1,350.
This year and in 2024, the government is handing out cash to millions of people.
Single payments are worth £900, £300 and £150.
Some people may be entitled to all three, which means a total of £1,350.
The living expenses payment of £900 is split into three installments of £301, £300 and £299.
The second installment of £300 has just been paid and the third will follow in the spring of next year.
A separate pensioner CoL payment of £300 will be distributed this winter.
In addition, a £150 Warm Home discount applies from now until March 31 next year.
You can also get help from your local council as part of the Household Support Fund.
For example, eligible households can get up to £350 free if they live in Tandridge, East Surrey.
You can also join our new Sun Money Facebook group to share stories and tips and collaborate with the consumer team and other group members.
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