The change means that even if a claimant’s energy bills increase, their benefit payments will remain stable
The Department for Work and Pensions (DWP) has announced it won’t increase gas and electricity payments that are automatically deducted from benefits.
It will give around 100,000 struggling families the opportunity to discuss options for paying their bills with the DWP and suppliers.
The move also means their benefit payments will remain stable as gas and electricity bills soar.
Some people who get Universal Credit, Jobseeker’s Allowance, Employment Support Allowance, Income Support and Pension Credit have their energy bills deducted from their benefits.
This is called ‘third party deductions’ and sometimes Fuel Direct.
For the next 12 months, only claimants will be able to increase the payments and the DWP will refuse supplier requests to hike bills.
The change means that even if a claimant’s energy bills increase, their benefit payments will remain stable.
It will give families the chance to speak with energy suppliers to discuss alternative payment options or pay the increase in bills privately.
Alternatively, households can ask the DWP to increase the payment from their benefits if they prefer.
Despite the freeze to automatic deductions rising, energy bills will still rise and claimants will have to find a way to pay the increase.
Deductions will continue to be made at the current level.
David Rutley, minister for welfare delivery, said: Budgeting requirements differ from household to household and this change allows people to maximise their benefit payment to suit their needs while also capitalising on other support available.
The DWP will also not process new energy supplier requests for ongoing energy consumption payments where an arrangement is not already in place.
But it will continue to consider requests from energy companies to make deductions for arrears which are lower, fixed amounts that prevent alternative enforcement action being sought.