In a fresh move to ease financial pressures on struggling households, the UK government has confirmed a new one-off £450 Cost of Living Payment for millions of low-income individuals and families. The Department for Work and Pensions (DWP) announced that this latest round of support will be distributed automatically from 6 May 2025, with payments expected to continue into June.
Who Will Receive the £450 Payment?
The £450 Cost of Living Payment is aimed at households receiving means-tested benefits. Eligible individuals must have been claiming at least one of the following benefits during the qualifying period, which has not yet been publicly disclosed:
- Universal Credit
- Pension Credit
- Income-based Jobseeker’s Allowance (JSA)
- Income-related Employment and Support Allowance (ESA)
- Income Support
- Working Tax Credit or Child Tax Credit (for some qualifying recipients)
Importantly, no application is necessary. Payments will be made automatically to eligible recipients via the same bank account used for benefit deposits. The transaction will appear with the reference “DWP COLP” along with the individual’s National Insurance number.
Why the Extra Support?
The payment is part of the government’s continued efforts to address the cost of living crisis, with inflation and energy costs still weighing heavily on households across the UK. While previous Cost of Living Payments were made in 2022, 2023, and 2024, this £450 payment marks a final round of universal support, with no further scheduled disbursements beyond 2025.
Minister for Social Mobility, Youth and Progression, Mims Davies, noted that the support is “targeted and time-limited,” ensuring those most in need are helped without extending broader inflationary pressures.
Additional Financial Support Available
While this is the only official Cost of Living Payment for 2025, there are other avenues of support that households may be eligible for:
Household Support Fund (HSF)
The Household Support Fund, originally introduced in 2021, has been extended through March 2026. Administered by local councils in England, the fund provides discretionary grants and vouchers for essentials such as:
- Energy and water bills
- Food
- Household goods
- Essential travel costs
The level and form of support varies by local authority. For example, Bournemouth, Christchurch, and Poole residents can apply for grants of up to £300. To find your local scheme, visit your council’s website or check gov.uk’s guidance on the Household Support Fund.
Energy Company Hardship Grants
Several energy providers—including British Gas and EDF continue to offer hardship grants to customers who are struggling to keep up with their bills. Depending on the provider and circumstances, grants of up to £1,700 may be available.
Customers are encouraged to contact their supplier directly or visit Ofgem’s help page for further information on applying for energy support.
Benefits and Pension Updates for 2025
As part of broader welfare reform and annual inflation adjustments:
- Most DWP benefits, including Universal Credit, have increased by 1.7% from April 2025.
- The State Pension has risen by 4.1%, in line with the government’s triple lock commitment.
Payment Dates and Bank Holidays
The DWP has also issued reminders regarding early payment dates around the May bank holidays. If your regular payment date falls on a UK bank holiday, it will be advanced:
- Monday 5 May payments: made on Friday 2 May
- Monday 26 May payments: made on Friday 23 May
Avoiding Scams
The government has stressed that no applications are required for the Cost of Living Payment. Individuals are advised to be vigilant of scam messages or fraudulent emails that request personal or banking information.
All official government communications will never ask for sensitive data via text or email. For scam awareness and reporting, visit Action Fraud.
Final Thoughts
While the £450 Cost of Living Payment offers timely relief for millions, financial experts warn that more sustained support may be necessary if living costs continue to rise. As of now, the government has not announced any future payments beyond this 2025 disbursement.
For more details or help checking your eligibility, you can contact Citizens Advice (citizensadvice.org.uk) or speak directly with your local council.