Cost-of-living fund extended after winter fuel payment cut

The government has announced the extension of a fund designed to help with cost-of-living pressures over the winter.

The money in the Household Support Fund will be distributed to councils, who can use the scheme to give struggling households small payments.

The extension comes after criticism of the Labour government’s decision to scrap winter fuel payments for 10 million pensioners in England and Wales.

Work and Pensions Secretary Liz Kendall said the new Household Support Fund would be launched in the coming weeks.

“Pensioners and others struggling with the cost of living over the colder months should contact their local council to see what support may be available to them,” she said.

The policy to scrap some winter fuel payments is expected to reduce the number of pensioners who receive the payment from 11.4 million to 1.5 million, saving the Treasury £1.4bn this financial year. It is a devolved matter in Scotland and Northern Ireland.

The Household Support Fund will be worth £421m in England and will run until the end of March next year. It was originally due to end in September.

The government is facing calls to rethink the winter fuel payment decision ahead of Rachel Reeves’s first budget as chancellor in October.

Prime Minister Keir Starmer warned the budget would be “painful” and said the government would have to make “big asks” of the public.

Sir Keir’s government repeatedly accused the Conservatives of leaving the public finances in a dire state since Labour won the general election in July.

In response, the Conservatives have been saying Labour inherited a growing economy and claim Sir Keir is laying the groundwork for tax rises.

The Household Support Fund was introduced in October 2021, with initial funding of £500m to help people hit by the Covid pandemic.

It has since been extended several times, most recently in the spring budget when the previous government provided a further £500m to extend the fund through to September this year.

Councils can use the money to help people afford their food, energy and water bills as well as other essential items.

The scheme is aimed at vulnerable people but individual councils can decide on their own eligibility criteria and how the money is spent.

The pot of money also includes cash for devolved administrations in Wales, Scotland and Northern Ireland to spend as they choose.