As we step into spring, financial relief is on the horizon for millions of UK households. April 2025 will bring an increase in benefits, state pensions, and the minimum wage, offering some much-needed support amid ongoing economic challenges.
However, rising household bills and persistent inflation mean that families must still prepare for financial strain.
Let’s break down what’s changing, what help is available, and how these updates could affect your finances.
Benefits
From April 2025, all benefits administered by the Department for Work and Pensions (DWP) will rise by 1.7%, in line with the September 2024 inflation figure. This includes:
- Universal Credit
- Pension Credit
- Disability Living Allowance (DLA)
- Personal Independence Payment (PIP)
- Attendance Allowance
- Carer’s Allowance
- Employment Support Allowance (ESA)
- Income Support
- Jobseeker’s Allowance (JSA)
- Child Benefit
The government is also continuing its migration of legacy benefits to Universal Credit, aiming for completion by January 2026. If you receive tax credits, income support, or housing benefit, you should have already received a notice about the switch.
Pensions
The State Pension will increase by 4.1% in April 2025 under the triple lock system, matching the previous year’s wage growth. This means pensioners will see an annual boost of approximately £472.
State pensions are paid every four weeks based on National Insurance (NI) numbers. Here’s when you should expect your payment:
| NI Number (Last Two Digits) | Payment Day |
|---|---|
| 00 to 19 | Monday |
| 20 to 39 | Tuesday |
| 40 to 59 | Wednesday |
| 60 to 79 | Thursday |
| 80 to 99 | Friday |
Minimum Wage
Workers across the UK will receive a 6.7% wage increase, translating to an annual boost of around £1,400 for full-time employees. This is an inflation-beating rise, helping to ease the pressure of rising living costs.
Household Bills
While income support is increasing, households will face rising bills in April 2025. Here’s what to expect:
- Energy Bills: The energy price cap rose by 1.2% in January and is expected to increase by another 5-7% in April.
- Water Bills: Set to increase due to infrastructure investment.
- Council Tax: Most local councils are increasing their rates.
Household Support
The Household Support Fund (HSF), extended until March 2025, provides financial help through local councils. Support can include cash grants, supermarket vouchers, and energy bill assistance. Check your local council’s website to see what’s available in your area.
Other Financial Help
If you’re on Universal Credit and facing financial hardship, you may be eligible for an interest-free budgeting advance loan, repaid via deductions from your benefits.
| Household Type | Loan Amount |
|---|---|
| Single Person | Up to £348 |
| Couple | Up to £464 |
| Parents | Up to £812 |
Starting April 2025, the government will cap Universal Credit deductions at 15% (down from 25%) to help ease financial strain.
Charitable Grants
Various charities provide financial grants to those struggling with costs. The Turn2us charity has an online tool to check eligibility for grants based on circumstances like illness, disability, or bereavement.
Energy Bill Support
Several energy suppliers offer hardship funds and payment plans:
- British Gas: Up to £2,000 grants (open to customers of all energy suppliers).
- EDF, E.ON, Scottish Power, Octopus: Various payment support options available.
Check with your provider to see what help you can access.
Council Tax Reduction
You may qualify for a council tax discount of up to 100% if you receive certain benefits. Even if you don’t qualify automatically, you can apply for a discretionary reduction if facing severe hardship.
Free Childcare
From April 2025, the final expansion of free childcare will roll out:
- 30 hours free for all working parents of children under five.
- 15 hours free for children aged nine months to two years.
Parents must reapply every three months to maintain eligibility.
What’s Next?
These income boosts will provide relief, but inflation remains stubbornly above 2%, and household costs continue to rise. While benefit increases match inflation, campaigners had pushed for a higher rise to reflect previous months’ figures.
Additionally, Labour is expected to release a green paper outlining changes to sickness and disability benefits. Details remain unclear, but the government aims to save £3 billion in this area.
Prices Go Down
Unfortunately, energy prices are expected to keep rising in 2025. The Ofgem price cap increased twice in 2024, with another 5-7% rise likely in April 2025. This means higher household bills throughout the year.
FAQs
When will benefits increase?
All DWP benefits will rise by 1.7% from April 2025.
How much will pensions rise?
The State Pension will increase by 4.1%, adding about £472 per year.
What is the new minimum wage?
The minimum wage will rise by 6.7%, giving workers a £1,400 boost.
Will energy bills go up in 2025?
Yes, another 5-7% increase is expected in April.
Who qualifies for free childcare?
From April 2025, all working parents of children under five qualify.
