The Chancellor Rachel Reeves has confirmed a new package of cost of living measures that will see millions of households receive financial support worth at least £150 from April. The changes form part of a broader set of policies announced by the Labour government aimed at easing pressure on family budgets.
The measures include reductions in energy bills and increases to Universal Credit payments. According to BirminghamLive, average energy costs are set to fall by £150 for millions of households, while additional welfare changes could leave some families hundreds of pounds better off each month.
Energy Bill Cuts to Deliver £150 Average Reduction
The headline measure is a reduction in household energy bills, due to take effect in April. The changes introduced by the government will reduce average costs by £150 for millions of households across the country.
The adjustment is designed to provide direct relief as many families continue to face elevated living expenses. The £150 figure represents the average annual drop in costs under the new arrangements, offering what ministers describe as a tangible boost to disposable income.The timing aligns with the start of the new financial year, a point at which several other policy adjustments are also scheduled to begin.
The government has presented the energy intervention as part of a wider strategy to address cost of living pressures.The reduction is one of several measures intended to support working households and those on lower incomes.
Universal Credit Increase and End of Two-Child Cap
Alongside energy savings, millions of people claiming Universal Credit will see their payments rise. BirminghamLive reports that there will be an above-inflation increase to the standard allowance, worth an additional £25 per month for single claimants aged 25 and over.
This increase forms part of a broader recalibration of welfare support. The government has also confirmed that it will scrap the two-child benefit cap, a policy that previously limited support for larger families. Removing the cap could result in families with four children receiving up to £608 more per month. Larger families with more than four children could see even greater gains under the revised system.
The combined effect of the Universal Credit increase and the removal of the cap is expected to provide substantial additional income for eligible households. Ministers have argued that these changes will lift hundreds of thousands of children out of poverty, reversing what they describe as long-standing pressures under previous administrations.
The measures have prompted criticism from some quarters, with opponents suggesting the government is being overly generous on welfare. Ministers, for their part, maintain that the reforms are targeted interventions aimed at supporting vulnerable families while addressing structural issues in the benefits system. From April, households across the UK will begin to see these policies reflected in their monthly bills and benefit payments, marking one of the first major cost of living interventions under Reeves’ tenure at the Treasury.
