The new Labour Government has confirmed that the popular Help to Save scheme will be extended for another two years until April 2027.
This represents a savings boon for those claiming benefits from the Department for Work and Pensions (DWP), such as Universal Credit.
Following today's Autumn Budget announcement, the scheme has been extended and widened.
Under Help to Save, benefit claimants can deposit a maximum of £50 a month for four years and get a 50 per cent Government boost at the end of years two and three.
According to the Government, this scheme was arranged to help Britons pick up a savings habit and provides up to £1,200 over four years.
Previously, Help to Save was set to end in April 2025 but has now been extended until April 2027. It will be open to all working Universal Credit claiming making at least £1 a month.
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Reeves confirmed Help to Save will be extended until 2027
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What is Help to Save?
Backed by the Government, Help to Saver is a type of savings account that is available to those claiming DWP support.
People on Universal Credit and Working Tax Credit get a bonus 1p for every £1 they save every four years. It is possible to save between £1 and £50 each month but money does not need to be paid every month.
The Help to Save will close four years after it opened and savers will not be able to reopen another account but they will be able to keep their cash in it.
Accounts can be closed at any time but once shut down, account holders will no longer be able to access their next bonus. These bonuses are handed out at the end of the second and fourth years.
As well as the extension of Help to Save, Reeves also confirmed the National Living Wage will increase from £11.44 to £12.21 an hour for employees aged 21 and over, a 6.7 per cent hike, from April 2025.
Those aged 18 to 20 years old will see their payments go up by £1.40 an hour, to £10.00 an hour.
On top of this, a new Fair Repayment Rate which caps deductions made through Universal Credit at 15 per cent of the standard allowance is being created. Prior to today's announcement, it was capped at 25 per cent.
Some 1.2 million households are expected to keep more of their Universal Credit payment each month, saving households £420 annually.
LATEST DEVELOPMENTS:
Reeves shared multiple DWP reforms in her Autumn Budget
GETTYDespite these changes, Thomas Lawson, CEO of anti-poverty charity Turn2us, claimed what is being proposed is not enough.
He explained: "Today’s Budget doesn’t go far enough. Our broken social security system is trapping millions of us in poverty.
"There are some positive steps, like raising the minimum wage and easing debt for Universal Credit recipients. But it’s not enough. The reforms to the Work Capability Assessment should be scrapped. They risk leaving 450,000 people, whose health prevents them from working, nearly £5,000 a year worse off.
"The Government needs to act. Scrap the two-child limit, scrap the 5-week wait, and raise Universal Credit to cover essentials. It’s time for a social security system that’s compassionate, free from stigma, and shaped by people with lived experience."
