Autumn Statement: Hunt aims to protect vulnerable but CIH urges benefits uprating to be brought forward

During his Autumn Statement, the chancellor said benefits, including working-age benefits and the state pension, will be increased in line with inflation from April next year. 

 

Payments will rise by 10.1 per cent, in line with September’s Consumer Price Index. The government said around 19 million families will see their benefits increase from April.

 

Pressure had been growing on the government to confirm the measure.

 

Gavin Smart, chief executive of the Chartered Institute of Housing (CIH), said he was “pleased” that the government was taking action to “support those most in need”. 

 

However he added: “Those on the lowest incomes will still face considerable pressures this winter, so we believe there is a strong case for the benefit uprating to be brought forward from April.

 

“Households who have faced a real-terms benefits cut cannot wait for the system to catch up,” he added.

 

In his speech, Mr Hunt also announced the government will provide households on means-tested benefits with an extra £900 cost-of-living payment in the next financial year.

 

The measures were announced as Mr Hunt confirmed that social housing rent increases will be capped at seven per cent for next year. 

 

The government will also make changes to Universal Credit to support mortgage borrowers with rising interest rates during periods of low income, from spring next year.

 

Those on Universal Credit will also be able to apply for a loan to help with interest repayments after three months instead of nine, the government said. 

 

It will also abolish the zero earnings rule, to allow claimants to continue receiving support while in work and on Universal Credit.

 

The government said it will bring forward the nationwide roll-out of the In-work Progression offer, starting with a phased roll-out from September next year.

 

It said this will mean that more than 600,000 Universal Credit claimants who are in work will be required to meet with a dedicated work coach for support to increase their hours or earnings.

 

The government said it is investing an extra £280m between now and 2024-25 to target fraud, error and debt across the benefits system.

 

It added that, from April 2023, the government will increase the National Living Wage by 9.7 per cent to £10.42 an hour for those aged 23 and over.

 

Local Housing Allowance 

 

The government has frozen Local Housing Allowance (LHA) rates at 2020 levels despite pressure from the sector. 

 

LHA is used to work out how much housing benefit somebody can get if they rent privately.

 

Mr Smart said: "We are disappointed that the chancellor did not use this opportunity to restore local housing allowance to the 30th percentile, as we had called for."

 

He added: “The affordability gap for private renters will only grow, ultimately resulting in increased homelessness. We would urge government to look again at this." 

 

Energy

 

The government said the Energy Price Guarantee (EPG) will be maintained through the winter, limiting energy bills to £2,500 per year for a typical household. From April next year the typical bill will rise to around £3,000 until the end of March 2024.

 

Mr Hunt had previously signalled he would scrap plans by Liz Truss, the previous prime minister, to cap energy bills for two years, sparking concern in the sector. 

 

The government said it will keep the EPG under review and may revisit the parameters of the scheme if costs rise significantly. 

 

The government will also develop a new approach to consumer protection in energy markets, which will apply from April 2024 onwards.

 

It will work with consumer groups and industry to consider the best approach, including options such as social tariffs, as part of wider retail-market reforms.

 

Mr Hunt also announced plans for a new energy-efficiency taskforce. This will include £6bn of new government funding, available from 2025 to 2028, to help the UK reduce the energy usage of buildings and industry in the long term.