Lowest income Welsh households to receive the largest share of funding from the cost of living response
The £330 million cost of living support package in Wales will see the most support going to households with the least, according to new analysis.
The Welsh Government has published analysis estimating the distributional effects of its immediate response to the cost of living crisis – through the Winter Fuel Support Scheme, Discretionary Assistance Funds, and the Cost of Living payment.
The schemes in Wales mean that many households with the lowest incomes in Wales will be able to receive payments of £350, with some entitled to further financial support from the Discretionary Assistance Fund.
The analysis shows that the response from the Welsh Government is highly progressive, with on average more financial support given to those on lower incomes.
In total up to around 75% of households are expected to be supported in some way. However, nearly twice as much will go to households in the bottom half of the income distribution compared to those in the top half, and 3 times as much to those in the bottom fifth compared to those in the top fifth.
The £150 cost of living payment is a broad based scheme, whereas the Winter Fuel Support Scheme and Discretionary Assistance Funds are more focused on households with lower incomes. The schemes mean that altogether the support in Wales is more generous and better targeted at the lower end of the income distribution than that offered in England by the UK government.
Rebecca Evans, Minister for Finance and Local Government, said:
We know this crisis will be most significant for those who have the least, so targeting support in this way is the fairest way of helping people.
The cost of living crisis is far-reaching and will affect those who may not have struggled to pay their bills before, so it was right to provide widespread support through the £150 cost of living payment. The extra support through the Winter Fuel Support Scheme and Discretionary Assistance Funds means this is a more progressive package that gets money to those who really need it.
Jane Hutt, Minister for Social Justice, said:
Families and households are under strain and we want to make sure people are supported. We’re aware that not everyone who is eligible for support is coming forward, a fact our analysis reflects. Our ‘claim what’s yours’ campaign seeks to raise awareness of the different avenues of support and we encourage everyone who needs it to make the most of what is available.
The Welsh Government’s cost of living package – which provides support to households in the current financial year and next year – was announced on 15 February. The funding for next year will be voted on today when the Senedd will debate the Final Budget.
Later this month the Chancellor of the Exchequer is expected to make the Spring Statement. It will likely be made shortly ahead of the increase to the energy price cap and the rise in National Insurance, while inflation is expected to keep increasing.
Rebecca Evans added:
Our £330 million support package was designed to ease pressures now while providing reassurance in the longer term. But we know full well that people will still be facing very real challenges. We took action in our budget, now it’s time for the UK government to step up in the Spring Statement.
One simple, effective action would be to reverse the cruel decision to remove the £20 uplift to Universal Credit, which has pushed more people towards a financial cliff edge.
We have suggested a number of other ways it could help households, for example moving the social policy costs to general taxation and introducing a low income energy tariff to better target support to lower income households. Its response to the cost of living crisis has fallen short so far; the Spring Statement must be a catalyst for meaningful, progressive support that will help those who need it the most.
Latest News from
Gigabit? Gigalot! Consultation opens on proposals to require all new homes built with download speeds of 1Gbps03/02/2023 14:15:00
The Minister for Economy Vaughan Gething and the Minister for Climate Change Julie James have announced a consultation into proposals to require housing developers to ensure all new build houses be equipped with gigabit broadband capability.
Here’s how £1.6bn record transport funding is being used across Wales03/02/2023 12:15:00
Brand new trains, hydrogen fuelled buses and tripling walking and cycling routes - these are just some of the ways the Welsh Government plans to ‘make the right thing to do, the easy thing to do’ according to Deputy Minister Lee Waters.
New stats show more than 2,600 affordable homes were built in Wales in the last financial year02/02/2023 15:10:00
New stats published today show that 2,676 additional affordable homes were built in Wales in 2021/2022.
More funding for organisations who help everyone use more Cymraeg02/02/2023 12:25:00
Community-based language initiatives and local Welsh language newspapers are some of the organisations receiving a share of almost £260,000 to help us all use more Cymraeg.
Plan to address NHS workforce challenges01/02/2023 13:20:00
The Welsh Government has today set out its plans to address the challenges of staffing the Welsh NHS.
Call for people in need to take up legal advice support01/02/2023 12:20:00
The Welsh Government is encouraging people in need of legal advice to come forward and see what support is available to them.
Business Wales: 10 years of supporting business growth in Wales31/01/2023 11:20:00
Ten years since its launch, Business Wales has supported more than 390,000 entrepreneurs and businesses, assisted the creation of over 19,000 new start-ups and directly helped to create nearly 47,000 jobs in the Welsh economy.
Welsh public asked to speak up if they spot the signs of “degrading and intrusive” forms of violence against women and girls30/01/2023 16:15:00
Members of the public in Wales are being advised to look out for women and girls who may be at risk from – or may have already been subjected to – virginity testing and hymenoplasty.
£50m to bring empty homes back to life30/01/2023 14:05:00
Minister Julie James has today (Monday, January 30) announced a new £50m scheme to bring more empty homes back to life.
Over 30,000 people in Wales sought financial help over Christmas period30/01/2023 10:25:00
33,351 people experiencing financial hardship accessed £2.36 million cash payments from the Welsh Government’s Discretionary Assistance Fund in December alone, according to new figures released by the Welsh Government.