MILLIONS of Brits on Universal Credit are set to receive a £1,200 savings boost.
Chancellor Rachel Reeves looks set to extend the Help to Save scheme which expires in 2027.
Reeves has been tipped to make the incentive permanent and open to parents and carers from 2028 onwards.
The Government gives you a tax-free 50 per cent bonus on whatever you save.
You can save between £1 and £50 into a Help to Save account each month and keep one open for up to four years.
The Government says around 93 per cent of those with a Help to Save account add the maximum £50 every month.
If you add the maximum £50 in each month for four years, you receive £1,200 free cash from the Government.
Bonuses are paid at the end of the second and fourth year of you holding the account.
It is set to be expanded to an extra 1.5 million potential savers, to include universal credit claimants who have children in education or carers who provide 35 hours of care to a disabled person to help them with the cost of living.
Although this will be good news for millions of Brits, the nation is set for a nightmare Budget on Wednesday as Ms Reeves is set to launch a huge tax raid on families’ finances.
Households should brace themselves for a range of money-raising tactics as the Chancellor tries to fill a £20billion black hole.
This includes a sneaky income tax rise through the back door as Ms Reeves is expected to extend the deep freeze on tax thresholds, known as a stealth tax.
This means more people are dragged into higher income tax brackets as inflation pushes their wages up.
A tax on “fun” such as a hike to gambling taxes could take place, as well as an attack on the cash Isa allowance and pensions.
Commenting on the pay rises, Ms Reeves said: “I know that the cost of living is still the number one issue for working people and that the economy isn’t working well enough for those on the lowest incomes.
“Too many people are still struggling to make ends meet, and that has to change.
“That’s why today I’m announcing that we will raise the National Living Wage and also the National Minimum Wage, so that those on low incomes are properly rewarded for their hard work.
“These changes are going to benefit many young people across our country, getting their first job.”
But fears were growing among business groups over the rise especially the hospitality sector who say a total £1.4 billion will be added to their wage costs.
The increase comes after warnings that an increase could harm the employment chances of the young.
What is the difference between the National Minimum Wage and National Living Wage?
The National Minimum Wage is the minimum pay per hour most workers are legally entitled to by law.
The rate varies depending on your age and whether you’re an apprentice.
However, the National Living Wage is the minimum amount that workers who are 21 or older must be paid.
The National Living Wage is the highest rate of the National Minimum Wage.
If you’re being paid less than these thresholds, talk to your employer.
You can ring these helplines for advice if you’re worried about being underpaid:
You can also complain to HMRC about your employer.
