The guarantee, which currently caps bills for the average household at £2,500 a year, will now remain at that level until June. It was due to expire on 1 April.
The increase would have doubled the number of people unable to afford their energy bills from one in 10 to one in five. However, households will still see their bills increase, as the £400 grant that has been issued in monthly instalments since October is coming to an end.
What is the £400 energy grant?
The £400 energy bill rebate is being paid to every household in the country, without means testing.
Originally, the plan was for households to receive a £200 discount on their energy bills in October 2022, which would then be paid back over five years from 2023, with customers paying an additional £40 on their bills each year.
However, after much criticism the Government announced the discount would be increased to £400 and would no longer have to be paid back.
You do not need to apply for the rebate; it should be sent to you automatically. How you get it depends on how you pay for your energy.
When is the final instalment?
The discount started in October and is being paid to consumers through energy suppliers in instalments over six months, finishing in March. Most people should already have received their final payment.
People received instalments of £66 in October and November 2022, rising to £67 per month from December through March 2023.
The payments have been provided monthly, regardless of whether people pay bills monthly or quarterly or have an associated payment card.
Unlike the low-income, disability and pensioner support, this scheme has not been extended, meaning it will end after March, and people will have to pay more on their energy bills.
How is the grant paid?
Those with a domestic electricity meter point who make payments through payment cards, standard credit, and direct debit will receive either an automatic deduction on bills or a separate payment, depending on their provider.
People who use prepayment meters and top up their credit before using energy should be provided with discount vouchers in the first week of each month. These will be sent by text message, email or post to the most up-to-date contact details customers have left with suppliers.
The discount also applies to students and other tenants renting properties with domestic electricity contracts from landlords where fixed energy costs are included in their rental charges. In these circumstances, landlords who resell energy to their tenants should pass the discounted payments on appropriately, in line with Ofgem rules to protect tenants.
No household should be asked for bank details at any point. Ministers have urged consumers to stay alert for potential scams and report these to the relevant authorities where suspected.
What other cost of living support is there?
The following support has been announced for 2023:
- £900 payment for more than eight million eligible means-tested benefits claimants
- £150 for over six million disabled people
- £300 for more than eight million pensioners on top of their winter fuel payments
Here is a breakdown of each one, and when they are expected:
£900 low-income payment
This will be paid to people who receive the following benefits:
- Universal credit
- Income-based jobseeker’s allowance
- Income-related employment and support allowance
- Income support
- Pension credit
- Working tax credit
- Child tax credit
The money will be paid in three separate payments over the course of the financial year, starting in the spring. Exact payment windows will be announced closer to the time, but are spread across a longer period to ensure a consistent support offering throughout the year, the Department for Work and Pensions (DWP) said. DWP has issued the following guideline:
- £301 – first payment during spring 2023
- £300 – second payment during autumn 2023
- £299 – third payment during spring 2024
That means people will receive £601 this year, with the remaining £299 in 2024. The slightly different payment amounts are to make it easier for DWP and HMRC to track which grants people have received, in order to minimise fraud risk.
Claimants who are eligible for any of the payments and receive tax credits, and no other means-tested benefits, will receive payment from HMRC shortly after DWP payments are issued, as was the case with the previous £650 grant.
The payments will be tax-free, will not count towards the benefits cap, and will not have any impact on existing benefit awards.
£150 disability payment
A £150 disability payment will be awarded to people who receive any of the following:
- Disability living allowance
- Personal independence payment
- Attendance allowance
- Scottish disability benefits
- Armed Forces independence payment
- Constant attendance allowance
- War pension mobility supplement
The payment will be made in summer 2023. The payment will be tax-free, will not count towards the benefits cap, and will not have any impact on existing benefit awards.
£300 pensioner payment
DWP is extending the £300 boost to the winter fuel payment that was issued in 2022. It will be paid in winter 2023-24. The winter fuel payment, also referred to as a “heating allowance”, is an annual tax-free payment from the DWP for older people.
Anyone who is eligible normally receives £100-£300 each year. The amount you get depends on when you were born, your living situation and the type of benefits you receive. The £300 comes on top of this.
You do not typically have to apply for the winter fuel payment if you are eligible. You should receive the money automatically. If you have not had the payment before, you will need to claim if any of the following apply:
- You do not get benefits or a state pension
- You only get housing benefit, council tax reduction, child benefit or universal credit
- You get benefits or a state pension but live in Switzerland or a European Economic Area country
- You get an adult disability payment from the Scottish Government
You can find more information about the winter fuel payment here.