Millions of homes across the country will start receiving their £650 cost of living payments from next month.

Rishi Sunak said more than eight million of the UK’s lowest income households will get their first instalment of £326 to help with soaring energy prices on July 14.

The second portion will then follow in the autumn as part of a support package ‘worth at least £1,200 for vulnerable families’ which also includes a previously announced £150 council tax rebate.

The Chancellor said: ‘We have a responsibility to protect those who are paying the highest price for rising inflation, and we are stepping up to help.’

Increasing costs of petrol, energy bills, supermarket prices and much more, has left families seeing hundreds to thousands of pounds being added to their regular bills.

Work and Pensions Secretary Therese Coffey said: ‘With millions of the lowest-income households soon seeing the first of two cash instalments land into their bank accounts, we are taking action to directly help families with the cost of living.

‘This one-off payment totalling £650 is part of our £37 billion cost-of-living support package that will put an extra £1,200 into the pockets of those most in need.’

Legislation to confirm the £650, as well as the other elements of the Government’s support package, is being laid on Wednesday.

Under the Government’s plan, pensioners will also receive a £300 payment in November/December alongside the winter fuel payment in a move costing £2.5 billion while £150 will be paid by September to individuals receiving disability benefits.

Every household in the country, regardless of how well off they are, will get a £400 discount on energy bills, raising concerns the move will further fuel inflation.

The Chancellor announced the emergency cost-of-living support package last month, saying £5 billion of the package would be paid for by a levy on the profits of oil and gas giants, and around £10 billion will be covered by extra borrowing.

Who is eligible for the cost of living grant?

The grant will be received by those households who receive means-tested benefits.

This includes the following:

• Universal Credit
• Income-based Jobseekers’ Allowance
• Income Support
• Working tax credit
• Income-related employment and support allowance
• Child tax credit
• Pension credit

Do you need to apply for the cost of living grant?

No – if you are eligible to receive the grant, you will automatically be paid the £650 across the two payments.

The Chancellor said: ‘Our policy will provide a larger average payment this year of £650 whereas uprating the same benefits by 9% would be worth only on average £530.’

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