Wed, 22 Oct 2025

Wed, 22 Oct 2025 Which benefits are going up and by how much?

The cost of living is always important but this month's data has a particular extra impact for millions of people.

* The UK's inflation rate has been steady at 3.8% in September, which means that millions of people will be affected by rising prices.
* Benefits and pensions will rise in line with inflation, with some benefits such as disability benefits and carer's allowance rising by at least 3.8%.
* Universal Credit (UC) is expected to rise by around 6.2% next year, which would mean a £6 increase in the standard UC allowance.
* The state pension will rise by average earnings growth of 4.8%, which is higher than inflation or price growth.
* Rising wages have not kept pace with inflation, with real pay growth weakening over the past 11 months.
* Inflation remains above the Bank of England's target rate of 2%, but a lower than expected inflation figure has sparked speculation about an interest rate cut.
* A rate cut could make it cheaper to borrow and could help put a stop to persistent rises in rents, but would also mean lower rates for savers.
* The chancellor is finalizing her Budget and has hinted that she may take action to bring inflation down further, possibly through lower household energy bills.
  >>