What impact did cost-of-living payments have?

When inflation soared in 2022, the government was forced to step in and provide help for struggling households.

But although these payments eventually ended in 2024, the cost-of-living crisis itself is far from over.

So as the debate over how best to support struggling households rages on, let’s look at what impact the government’s cost-of-living payments actually had.

As you’ll see in these figures from the Department for Work and Pensions, there’s a mix of positives and negatives…

Positives 

Energy bills relief

• Almost half (48%) feel the payments “helped a lot” with energy and utility bills.
• More than a third (35%) say they “helped a little”.

Debt prevention

• Nearly two-thirds (63%) believe the payments helped them avoid taking on new debts.

Reduced stress

• Over half said they felt less stressed after getting the payments.
• Around half said it gave them more control over their finances.

A better family and social life

• Many people said the payments helped them reconnect with friends and family, and even treat their children for the first time in months.

Negatives

Limited long-term impact

• More than half (52%) felt their financial situation hadn’t changed by mid-2024.
• 30% felt it had worsened, and just 18% felt it had improved.
• Just 6% feel that the payments significantly improved their debt situation.

Payments not targeted

• Payments didn’t reflect how some recipients had much higher essential outgoings than others.
• Recipients who struggled the most felt the least benefit, as payments were absorbed into everyday expenses such as rent and childcare.

Short-term relief

• Most recipients said the help didn’t last beyond the month it was received, with most spending it within three weeks.

What cost-of-living help can I get right now?

If you’re struggling with your day-to-day expenses, you may be able to get help from your local council through the household support fund.

This provides targeted support help with essential costs such as:
food

• energy bills
• water bills
• other essential living costs

You may also want to check whether you’re entitled to any grants to help with the rising cost of living. 

Enter your details in the Turn2us grant checker and see if there are any you can apply for.

It’s also well worth taking steps to work out and set your budget, and checking if you’re getting all the benefits that you’re entitled to.