Despite a decline in inflation rates to pre-pandemic levels, millions of UK households continue to feel the squeeze of rising living expenses. A recent report by the Resolution Foundation reveals that the cost of essential goods remains stubbornly elevated, outpacing stagnant wage growth and pushing families into debt.
While the peak of the cost-of-living crisis occurred in 2022, the situation has yet to stabilize. For instance, energy debt soared to £3.9 billion by the end of 2024, and food insecurity affected around 7.3 million adults in January 2025, according to The Food Foundation. The financial strain continues despite inflation cooling off, making government support more critical than ever.
Millions Missing Out on Unclaimed Benefits
Shockingly, research from Policy in Practice estimates that £23 billion in benefits go unclaimed annually. With over 24 million people now receiving some form of DWP-administered assistance, it’s vital that those eligible use available tools—such as benefit calculators—to determine what support they can access.
Key Benefit Payment Dates for August 2025
Most benefit payments will be issued on regular schedules throughout August, but the Summer Bank Holiday on Monday, 25 August will shift some payments forward:
- Payments due on Monday, 25 August, including Universal Credit and State Pension, will be paid early on Friday, 22 August.
These changes apply to:
- Universal Credit
- State Pension
- Pension Credit
- Child Benefit
- Disability Living Allowance (DLA)
- Personal Independence Payment (PIP)
- Attendance Allowance
- Carer’s Allowance
- Employment Support Allowance (ESA)
- Income Support
- Jobseeker’s Allowance (JSA)
State Pension Payment Schedule
The basic State Pension is paid every four weeks, with the specific weekday determined by the final two digits of your National Insurance (NI) number:
| NI Number Ends With | Payment Day |
|---|---|
| 00–19 | Monday |
| 20–39 | Tuesday |
| 40–59 | Wednesday |
| 60–79 | Thursday |
| 80–99 | Friday |
Upcoming Benefit Increases
In April 2025, working-age benefits were increased by 1.7%, following the inflation rate recorded in September 2024. This adjustment impacted all major benefits including:
- Universal Credit
- PIP
- DLA
- ESA
- Attendance Allowance
- Carer’s Allowance
Meanwhile, the State Pension rose by 4.1%, translating to an extra £472 annually, as part of the triple lock mechanism.
Looking ahead to April 2026, all Universal Credit recipients will see a 2.3% or more increase, with annual extra-inflationary rises scheduled through 2029. However, the health-related component for new claimants will be cut from £105 to £50 per month, and remain frozen until 2029. This represents a potential loss of over £200 monthly, making early claims advisable.
Additional Financial Support Available
Budgeting Advance Loans
Claimants on Universal Credit can request an interest-free Budgeting Advance Loan for urgent expenses. Repayments are deducted from future benefits over two years.
Loan caps:
- £348 (single individuals)
- £464 (couples)
- £812 (households with children)
From April 2025, repayment deductions will be capped at 15% of the standard allowance (down from 25%).
Discretionary Housing Payments (DHP)
Households receiving Housing Benefit or the housing element of Universal Credit may qualify for Discretionary Housing Payments. These can help cover:
- Rent shortfalls
- Deposits
- Rent-in-advance for relocation
Eligibility and award amounts are determined locally by councils.
Household Support Fund (HSF)
This fund supports financially struggling households with:
- Emergency cash up to £300
- Help with utilities
- Provision of essential appliances
Each council allocates funding based on local needs. The scheme is expected to continue until March 2026, after which it will transition to a new Crisis and Resilience Fund.
Charitable Grants
Organizations like Turn2us help individuals identify suitable charitable grants for:
- Disabled persons
- Carers
- Bereaved individuals
- Students
- Unemployed people
These funds are usually limited and criteria-specific.
Help from Energy Providers
Several providers—including British Gas, E.ON, Octopus, EDF, and Scottish Power—offer hardship support. Contact your provider directly to check eligibility.
Council Tax Reduction
You may qualify for a council tax reduction of up to 100% if you are on benefits or facing financial hardship. Local councils also offer discretionary reductions in severe cases. Applications can be made online through the government’s council portal.
Expanded Free Childcare
As of 1 September 2025, all working parents with children under five are entitled to 30 hours of free childcare weekly. Current entitlements include:
- 15 hours for 2-year-olds
- 30 hours for 3 to 4-year-olds
- 15 hours for children from 9 months old (since September 2024)
Parents must apply online and reconfirm eligibility every three months. Additional support is available through tax-free childcare, offering 20% cashback up to £500 per year.
Energy Price Cap Update
Ofgem’s energy price cap fell from £1,849 to £1,720 for the July–September quarter—down 7%. This cap sets the maximum rate per energy unit for households on standard variable tariffs.
Cost of Living Payment 2025: Any More Coming?
The Cost of Living Payment program, which ran from 2022 to early 2024, has officially ended. No further payments are scheduled for 2025 as of now.
Mental Health Support Services
If you’re feeling overwhelmed:
- Samaritans: Call 116 123 anytime, or email jo@samaritans.org
- Mind: Emotional support (0300 102 1234), information line (0300 123 3393), benefits support (0300 222 5782)
- Scope: Online forums for those facing similar challenges
- NHS England: Offers online triage for mental health support
Conclusion
With the cost of essentials still weighing heavily on UK households, it’s crucial to ensure you’re claiming all benefits and support available. From Universal Credit increases and Budgeting Advances to free childcare and council tax reductions, there is a range of assistance that can help ease financial burdens. By staying informed and proactive, households can access the lifelines designed to carry them through these challenging times.
FAQs
What date will my benefit be paid in August 2025?
If your scheduled payment falls on Monday, 25 August 2025, due to the Summer Bank Holiday, it will instead be deposited on Friday, 22 August.
How do I know if I’m eligible for unclaimed benefits?
You can check your entitlement using online calculators from reputable organizations like Policy in Practice or Turn2us, which assess your eligibility across various schemes.
Can I still receive Cost of Living Payments in 2025?
No, the Cost of Living Payment scheme concluded in February 2024. No extensions or additional payments have been confirmed for 2025.
What is the new Universal Credit deduction cap?
Starting April 2025, repayment deductions for loans or debts from Universal Credit will be capped at 15% of the standard allowance, down from the previous 25%.
Is childcare free for all children under five?
Yes. From September 2025, all working parents will be entitled to 30 hours of free childcare per week for children under the age of five.