April 2025 benefits and pensions to increase in UK

Starting in April 2025, many people in the UK will see increases in their benefits, state pensions, and the minimum wage. Benefits and most state pensions administered by the Department for Work and Pensions (DWP) will rise by 1.7 percent. The state pension will increase by 4.1 percent, in line with wage growth, giving pensioners an additional £472 per year. The minimum wage is set to rise by 6.7 percent, giving many workers a pay boost of £1,400. While these increases can help households, costs are also rising. Bills for energy, water, and council tax are expected to increase significantly in April. The Labour government has announced cuts to the welfare system, totaling £5 million. Changes will include adjustments to Universal Credit next year and stricter criteria for the Personal Independence Payment (PIP). Research indicates that the UK faces a challenging economic situation, with over 14 million people living in poverty as of 2022/23. This includes millions of working-age adults, children, and pensioners. Benefit payments will generally go out as usual in April, except for those scheduled on holidays. Payments due on Good Friday (April 18) or Easter Monday (April 21) will be paid on Thursday, April 17. In addition to automatic increases in benefits, there are options for those needing extra help. The DWP aims to move all ‘legacy benefits’ to Universal Credit by January 2026. Nearly £23 billion in benefits goes unclaimed each year, so the government has tools to help people check what they may be entitled to. Universal Credit will see some changes next year, including a one-time increase in the standard allowance. However, the additional health element will be frozen and new claimants will receive much less. It is advisable for anyone eligible to apply sooner rather than later. If you face financial hardship, you might be eligible for budgeting advance loans from Universal Credit, which offer interest-free borrowing with a maximum repayment period of two years. There are also charitable grants available for various groups, as well as help from energy suppliers for those with high energy bills. Working parents can access free childcare, expanding from 30 hours for children aged 3 to 4, to include 15 hours for two-year-olds from April. By September 2025, all children under five will be eligible for free childcare. On the energy front, the price cap for household energy bills will increase to £1,849 from April to June, marking another rise in costs. This means households can expect higher monthly bills as the energy market adjusts.