We’ve written recently about the rising cost of living, with rising energy bills and high inflation hitting households up and down the country.
It seemed inevitable that the government would need to step in to avoid further crisis, and they’ve now announced a support package designed to help people muddle through 2022.
Unlike Universal Credit and other state benefits, these new measures are being applied to the vast majority of homes, meaning that most people reading this will be eligible for support. It comes in the form of two rebates:
- A £150 council tax rebate for all homes in council tax bands A – D. This will not need to be repaid.
- A £200 levy on energy bills for every household. This will be recovered at a rate of £40 per year from 2023 – 2027
How do I get my money?
Most people pay their council tax by direct debit. In this case, the money will be paid automatically into the bank account that you use to make your monthly payments. It is expected to be paid this coming April. For those who don’t pay by direct debit, it will be necessary to submit a claim directly to the council. More information on this is expected over the coming weeks. People who live alone are already eligible for a 25% reduction on their bill – but will be pleased to hear that they also qualify for the full £150.
The £200 energy rebate will also be applied automatically, although you won’t get this one in cash. Instead, it will be processed as a discount on your energy bill.
Will this apply to renters?
Broadly speaking, yes – but only those who pay their own bills. The money will go to whoever makes the payments, so if your landlord pays for your bills and includes them as part of the rent, they’ll receive the refund. You may want to speak to them about making sure that any savings are reflected in the amount that you pay, but it will be up to the individual landlord to decide what to do.
Generation Rent campaigners explained why this could mean that some households miss out: “Many renters living in large, shared houses will fall into a higher council tax band and miss out on the £150.”
“It is more common for your landlord to include energy bills in your rent in shared houses. In this case it would be easy for the landlord to hang on to the £200 loan, but a bigger problem is that your ability to reduce your bills is out of your hands.”
“Even if you cut down on energy use it could be difficult to persuade your landlord to pass the savings on.”
How will the money be repaid?
As we mentioned, the £150 council tax rebate is yours to keep, but people will be expected to repay their energy discount. Fortunately, you don’t need to worry about setting up payment plans or any admin work. It will be automatically applied as a £40 charge on all household energy bills over the coming five years. The good news is, wholesale gas prices are expected to have fallen by then – meaning that, by the time repayments are made, you should have seen a reduction in your overall energy bills.