Bill to legislate for 2023/24 Cost of Living Payments introduced in Commons

The Social Security (Additional Payments) (No. 2) Bill 2022-23 was introduced to the House of Commons on 7 February 2023¹. It provides for two Cost of Living Payments announced as part of a wider package of support for households in 2023/24 announced in the 17 November 2022 Autumn Statement¹.

The payments are a £900 Cost of Living Payment, referred to in the Bill as "means-tested additional payments", paid in three instalments to recipients of certain means-tested benefits including Universal Credit, most of the legacy benefits and tax credits it is replacing (except Housing Benefit), and Pension Credit¹. The second is a £150 Disability Cost of Living Payment, referred to in the Bill as "disability additional payments", for recipients of certain non-means-tested disability benefits, including Personal Independence Payment (PIP), Disability Living Allowance (DLA), Attendance Allowance (AA), and corresponding devolved Scottish disability benefits¹.

The Government also announced £300 Pensioner Cost of Living Payments and further funding for discretionary support through the Household Support Fund; these do not require new primary legislation¹. The Bill also allows the Secretary of State, through regulations, to set qualifying dates for the payments¹. Its territorial extent and application covers England and Wales, Scotland, and Northern Ireland¹.

Cost of Living Payments were estimated to cost £8.8 billion in 2022/23 and are expected to total over £11 billion in 2023/24¹. In 2023/24, over 8 million households are expected to receive a means-tested benefit Cost of Living Payment, 6.7 million disabled people will receive a Disability Cost of Living Payment, and 11.7 million pensioners will receive an uplift to their Winter Fuel Payment; these groups overlap¹. The further £1 billion for the Household Support Fund and for the devolved administrations for 2023/24 is the same in cash terms as the amount allocated in 2022/23¹.

Why it matters for households

The Bill puts the 2023/24 means-tested and disability payments on a legislative footing, and lets the Secretary of State set qualifying dates by regulations¹. The payments sit alongside a scaling back of universal support: the Energy Price Guarantee is being scaled back from April, capping typical household energy bills at £3,000, rather than £2,500¹.

The Library notes concern that certain groups may miss out on means-tested benefit Cost of Living Payments, including low-income households not receiving means-tested benefits, those getting Housing Benefit and no other qualifying benefit, and claimants who get a nil award of Universal Credit during the qualifying period¹. It adds that larger families on means-tested benefits receive the same level of support as a single person, despite often facing significantly greater costs¹.

On benefit uprating, the Library says current practice is to "uprate" benefits based on year-to-September inflation figures, with increases implemented the following April¹. It says that in both the 2022/23 and 2023/24 financial years, the uprating process has left the level of benefits, excluding Cost of Living Payments, lower in real terms than before the inflationary spike, a situation it says will last at least until April 2024¹. The annual rate of Consumer Price Inflation reached a peak of 11.1% in October 2022, a 41-year high, and CPI inflation was 10.1% in January 2023¹.

What happens next

The Bill's progress through Parliament, including the dates of its remaining stages, has not been reported in the material available. The Library briefing sets out detailed commentary on the provisions of the Bill in section 6 of its report and in the Explanatory Notes accompanying the Bill¹.