The Department for Work and Pensions (DWP) recently confirmed that there will be no further cost of living payments issued in 2025, a decision that has raised concerns among those still grappling with financial pressures. The announcement, made on May 6, 2025, comes after a series of one-time payouts aimed at alleviating the burden of soaring energy costs and inflation that have strained households across the UK.
Between 2022 and 2024, the DWP provided payments ranging from £150 to £326 to support lower-income groups, pensioners, and disability benefit recipients. As energy bills and inflation reached unprecedented levels, these payments were a lifeline for many. However, with the DWP’s recent announcement, individuals are now urged to explore alternative forms of financial support.
The cost of living payments included various amounts for different groups: low-income and Tax Credits recipients received payments of £326, £324, £301, £300, and £299, while disability recipients were given £150 twice. Pensioners, on the other hand, received either £150 or £300, depending on their eligibility for Winter Fuel Payments, which amounted to a total of up to £600 over the winters of 2022/23 and 2023/24.
As the DWP stated in its update, "DWP is not planning to make any more Cost of Living Payments." This decision has prompted many to consider checking for unclaimed benefits as a potential source of financial relief. The DWP advised those struggling financially to look into other support options, including unclaimed benefits, as many may be eligible for assistance they are unaware of.
In light of the DWP's announcement, experts suggest that setting aside just ten minutes to use a free, confidential benefits calculator could significantly help individuals assess their eligibility for various benefits. This could be particularly beneficial for those on a low income, who could save up to £850 a year through the Council Tax Reduction scheme, which is available in certain regions.
According to the latest figures from the Scottish Government, about 458,470 households, or one in five, were eligible for a Council Tax Reduction as of December 2024. Furthermore, older individuals on a low income might qualify for an income boost through Pension Credit, which averages around £4,300. Alarmingly, an estimated 760,000 individuals are eligible for this means-tested benefit but are not currently claiming it.
Many pensioners mistakenly believe that having savings or owning a home disqualifies them from Pension Credit, but even a nominal award of just £1 per week can unlock additional support. For those looking to check their eligibility, the online Pension Credit calculator on GOV.UK can provide quick estimates of potential benefits, or individuals can contact the Pension Credit helpline directly.
Moreover, individuals under State Pension age with health conditions may be eligible for Adult Disability Payment or Personal Independence Payment (PIP), with successful claims worth between £29.20 and £187.45. Those over State Pension age facing health issues could qualify for Pension Age Disability Payment or Attendance Allowance, with claims valued at either £73.90 or £110.40 per week.
Despite the cessation of cost of living payments, the DWP has emphasized that financial support remains available through the Household Support Fund (HSF), which has been extended until March next year with an additional £742 million in funding. This fund is distributed by local councils, which determine how to allocate the resources, including cash grants and energy bill assistance.
Chancellor of the Exchequer Rachel Reeves stated, "With today’s increase in working-age benefits, and our ironclad commitment to pensioners through the Triple Lock, we are making the decisions that support those who need it in Britain, putting money into people’s pockets and delivering our Plan for Change." This reflects the government’s ongoing commitment to support vulnerable populations even amid the end of the cost of living payment scheme.
Changes are also being made to the Fair Repayment Rate, which determines how much can be deducted from individuals’ benefits if they are in debt. Previously, the maximum deduction from Universal Credit was 25 percent, which has now been reduced to 15 percent, potentially adding an average of £420 to some households’ finances.
As households adjust to the absence of direct cost of living payments, many are encouraged to reach out to their local councils to inquire about available assistance. Most councils can help check eligibility for benefits or a Council Tax discount, which could alleviate some financial burden.
In summary, while the DWP has halted cost of living payments, numerous other avenues for financial support remain open. Individuals are urged to take proactive steps in checking for unclaimed benefits and to utilize available resources to ensure they are receiving the assistance they qualify for. In this challenging economic climate, every bit of support can make a significant difference.
