The post-pandemic cost of living crisis continues to make life difficult in Britain this summer – even after a level of stability returned to the international energy market, allowing heating bills to rise. of the house going up after a long winter at sky high prices.
With inflation pegged at 8.7 percent, new woes are emerging for mortgage holders battling high interest rates and in the form of inflated prices in supermarket aisles, the Office for National Statistics (ONS) put food inflation at 18.4 percent in May.
However, Sainsbury’s chief executive Simon Roberts said he believed levels were about to start to fall as retail sales improved in response to warmer weather, as prices of staple items such as bread, butter, milk, pasta and meat fell in its supermarkets during the second quarter of the year in response to more favorable trading conditions.
That said, the news that supermarkets have been accused of profiting from “snapping” fuel prices up front, resulting in drivers paying almost £1 billion in odds for petrol and diesel last year, tend to be more demoralizing. a battered public tired of struggling against the economy.
Below, we look at what support is available to households this August.
Additional £1,350 support paid
Despite Rishi Sunak’s Energy Bill Support Scheme expiring at the end of March (an initiative that provides £400 in monthly installments of £66 and £67), millions of low-income households will receive additional cost of living support from the government. this year cost £1,350 in total.
Eight million eligible means-tested benefits claimants, including people with universal credit, pension credit and tax credits, will receive £900 installments as part of a program which has started this spring, with the money going directly to bank accounts in three tranches, the Department for Work and Pensions (DWP) said.
There is also a separate £150 payment for over six million people with disabilities and an extra £300 for over eight million pensioners.
Here are the payment windows announced so far, with more precise dates expected later in the year:
- £301 – First living expenses payment – issued between 25 April and 17 May (or 2 to 9 May for people on tax credits but no other low-income benefits)
- £150 – Disability fee – during summer 2023
- £300 – Second living expenses payment – during autumn 2023
- £300 – Pensioner payment – winter period 2023/4
- £299 – Third cost of living payment – during spring 2024
The bank holiday brings a change in the payment schedule
The usual state support in the form of benefits and pension payments will also come out in August, although the arrival of the Summer Bank Holiday on Monday 28 means that anyone expecting to receive their money by that date will usually expect it to pay off. their bank accounts one business day earlier (Friday 25, for example).
That applies to anyone expecting to receive any of the following from the DWP in August:
- Universal credit
- State pension
- Pension credit
- Disability living allowance
- Paying for personal freedom
- Attendance allowance
- Carer’s allowance
- Work support allowance
- Income support
- Jobseeker’s Allowance
For more information on how and when to pay state benefits, please visit the government website.
The Energy Price Guarantee expires as the cap is lowered
The hot weather that we can expect to continue into August – which has already brought the hottest June since records began in 1884 – may not be comfortable for everyone but it will at least reduce the need for central heating, which proves so. a cost of the winter season is gone.
The government’s Energy Price Guarantee (EPG) – introduced by Liz Truss in September to ensure households pay no more than £2,500 for their electricity and gas, with the government subsidizing the rest owed to energy providers under Ofgem’s Energy Price Cap (EPC) – extended. by chancellor Jeremy Hunt in his Budget on March 15 for an additional three months.
Mr Hunt was reportedly tempted to increase the EPG to £3,000, a less generous offer that would ease the state’s burden, but ultimately thought better of it, extending the guarantee to April, May and June .
Now that the EPG has finally expired, consumers will once again pay the EPC rate, which Ofgem set at £2,074 for the third quarter starting July 1, a big fall from the £3,280 set in during the second quarter, from where. households are protected by the intervention of the government’s superior guarantee.
That 17 percent drop reflects the recent drop in wholesale energy prices — the amount energy companies pay for electricity and gas before supplying it to households — and, even if this is a significant drop from the irrigation rates of the previous two years, the figure remains more than £1,000 a year above pre-pandemic levels.
As for what happens next, consultancy firm Cornwall Insight predicts that the drop in July will be followed by another drop in October, when the average annual bill is expected to be £1,976.
Unfortunately, it believes the average bill will rise again in January 2024 to £2,045 and Cornwall does not expect energy prices to return to pre-Covid levels before the end of the decade at the earliest.
It also warned customers that prices remain subject to volatility in the wholesale market, with the UK’s reliance on energy imports meaning geopolitical incidents such as the war in Ukraine could will continue to have a detrimental effect.