Cost of living payment: DWP warns £326 cash support due this month could be delayed

The Department for Work and Pensions (DWP) has warned of “potential delays” to a cost of living payment that is due to be paid later this month.

Around eight million low income households on benefits are due to receive the first instalment of a one-off £650 payment in mid-July to help with soaring energy prices.

The cash will be paid in two parts, with the first £326 payment to be issued in July and the second £324 payment to follow in the autumn.

What has the DWP said?

The DWP confirmed last month that the £326 would arrive in the bank accounts of eligible households on 14 July, but this may now be delayed due to the volume of people in line to receive it.

It warned there “may be potential delays for a small minority of cases due to their unique characteristics”.

The £650 payment is part of a package of support worth £1,2000 that will be issued to vulnerable households, and also includes a previously announced £150 council tax rebate.

Work and Pensions minister David Rutley previously said the extra payments would not take households over the £16,000 savings limit for Universal Credit if they choose to save it, or be subject to the benefit cap.

In response to a recent query from Independent MP Neil Coyle asking whether all Universal Credit claimants will receive the payment at the same time as those on other benefits, the DWP said payments will be staggered due to the high number of people entitled to the support.

In a written response, Mr Rutley said: “Due to the volume of people entitled to the payment, it is not possible to issue all of the Cost of Living Support Payments at the same time.

“Issuing payments will be staggered, but not by benefit type, starting on July 14, 2022.”

He added: “We currently expect the majority of payments to be made by the end of July, there may be potential delays for a small minority of cases due to their unique characteristics.”

It means the vast majority of the eight million people eligible should receive the first part of the £650 cost of living payment between 14 and 31 July.

Who is eligible for the £650 payment?

Eight million low-income households that receive benefits based on income will be eligible for the one-off payment, regardless of how much benefit you get.

These types of benefits are means-tested and to qualify, people need to demonstrate that their income, savings and capital are below a certain level.

The £650 payment will apply to the claimants of the following benefits:

• Universal Credit
• Working Tax Credit
• Child Tax Credit
• Pension Credit
• Income-based Jobseekers Allowance
• Income-related Employment and Support Allowance
• Income Support

The DWP will make the payment in two lump sums directly into claimants bank accounts, with the first £326 instalment to be paid from 14 July and the second £324 instalment in autumn.

Payments from HMRC for those on tax credits only will follow shortly afterwards.

Those who are not eligible for the £650 will still benefit from some of the other payments being rolled out by the government.

Pensioners will receive a £300 payment in November/December alongside the winter fuel payment in a move costing £2.5 billion, while £150 will be paid by September to people receiving disability benefits.

Every household in the country, regardless of their financial situation, will also get a £400 discount on energy bills in October, which will be partly funded by a £5 billion windfall tax on oil and gas giants.