Five Changes Coming In Autumn 2023 – From Cost Of Living Payments to Interest Rates

THE persisting cost of living crisis continues to cast its shadow, with food and energy prices remaining stubbornly high despite a decline in inflation.

As autumn approaches, parents often encounter additional expenses like school uniforms, making it crucial to manage finances effectively. Even though its a few months away, and nobody wants to think about ir right now, Christmas adds further financial strain, underscoring the importance of staying financially prepared.

What financial changes can we expect this autumn, and when should we anticipate them?

Cost of Living Payment:

The second installment of the Cost of Living Payment, amounting to £300, will be paid this autumn.

While the exact date remains unspecified, last year’s payments were spaced four months apart in 2022. The first 2023/4 payment of £301 was distributed from late April to mid-May.

Following this pattern, the second payment could be expected anywhere from late August onward. A third installment of £299 is set for Spring 2024.

Eligible recipients include those receiving at least one of the following benefits:

– Universal Credit
– Income-based Jobseekers’ Allowance
– Income-related Employment and Support Allowance
– Income Support
– Working Tax Credit
– Child Tax Credit
– Pension Credit.

These payments are directly deposited into bank accounts, requiring no application process. If eligible individuals don’t receive the payment, they can report the issue online.

Interest Rates:

The Bank of England is set to announce new interest rates on Thursday, September 21, 2023.

In early August, the Bank of England’s Monetary Policy Committee increased the base interest rate to 5.25 per cent, marking its highest level since 2008. While future developments are uncertain, reports indicate an anticipated rise in interest rates at the upcoming announcement.

A subsequent announcement is scheduled for Thursday, November 2. Elevated interest rates can lead to increased mortgage repayments, benefiting savers but potentially causing financial strain for homeowners.

Energy Price Cap:

The Energy Price Cap, which limits energy companies’ charges per energy unit, will be reset on October 1, 2023.

The current cap stands at £2,074, capping the cost per unit of energy for a typical household. However, the cap doesn’t limit overall bills, only individual unit costs.

The new Energy Price Cap set in October is unpredictable, making decisions about switching to a fixed tariff challenging. The cap’s adjustment might prompt further reductions.

Winter Fuel Payment:

The Winter Fuel Payment is a government aid provided to individuals born before September 25, 1957, to assist with heating bills.

The amount varies between £250 and £600 and includes a ‘Pensioner Cost of Living Payment,’ ranging from £150 to £300, distinct from other Cost of Living Payments. Most payments are typically distributed between November and December.

Claiming is unnecessary if individuals receive State Pension, Pension Credit, Attendance Allowance, Personal Independence Payment (PIP), Carers Allowance, Disability Living Allowance (DLA), Income Support, income-related Employment and Support Allowance (ESA), income-based Jobseeker’s Allowance (JSA), or awards from the War Pensions Scheme.

However, those who haven’t received Winter Fuel Payment before or deferred their State Pension since the last payment need to apply.

Energy Help Schemes:
The government’s Cold Weather Payment scheme for England, Wales, and Northern Ireland recommences on November 1.

It provides £25 for each 7-day period of cold weather until March 31.

Payments are triggered if the average temperature falls to 0°C or below for seven consecutive days.

The Warm Home Discount Scheme also restarts in October, offering a one-off £150 discount on electricity bills.

Eligible recipients, such as those receiving the Guarantee Credit element of Pension Credit or facing high energy costs on a low income, are notified by letter.