MPs have called for a full-scale review of carer’s allowance and an end to harsh benefit rules that have resulted in tens of thousands of unpaid carers being fined huge sums and in some cases prosecuted for minor infringements of earnings limits.
The calls came as new official figures showed that the number of unpaid carers incurring fines after inadvertently falling foul of earnings rules soared to more than 34,000 last year, with more than 1,000 individuals hit with sums of between £5,000 and £20,000.
Campaigners said this meant one in five carer’s allowance claimants who worked part-time on top of their caring duties were overpaid in 2023-24, landing many with huge debts they would spend years paying off.
The figures, slipped out last Friday afternoon by the Department for Work and Pensions (DWP), suggest ministers have failed to get a grip on overpayments despite promising five years ago to tackle the issue.
MPs repeatedly brought up the issue of overpayments at a Westminster Hall debate on Monday evening, reflecting growing concerns – from parliament to daytime TV – over the injustices forced on unpaid carers.
The Guardian has in recent weeks revealed and documented the despair and misery experienced by unpaid carers forced to pay huge fines – and sometimes prosecuted for fraud – after minor breaches of carer’s allowance earnings rules amounting to a few pounds.
Although the DWP has in place data-matching technology alerting it to overpayments as they happen, its failure to investigate thousands of potential earnings breach notifications each month mean many continue undetected, often building up into sums of thousands of pounds, which when finally identified, carers must repay.
Although most breaches involve trivial amounts, the “cliff-edge” nature of carer’s allowance penalties – and rigid enforcement policies – mean carers must repay their entire weekly £81.90 allowance if they breach the £151-a-week earnings limit by even one penny.
The Liberal Democrat leader, Ed Davey, told MPs that the injustice of carer overpayments had become the “issue of the day”. He criticised the government for failing to fix the system despite being warned of the problems years ago. “We need a full-scale review of carer’s allowance, and we need it urgently,” he said.
Vicky Foxcroft, the shadow disability minister, said: “The government needs to urgently investigate the overpayments issue and outline what steps it is taking to ensure it does not happen in the future.”
Emily Holzhausen, the director of policy for Carers UK, said: “The new figures show that the number of overpayments for carers in relation to earnings has remained unacceptably high for the last three years. The scale is just breathtaking – it’s a clear sign of a system that’s not working.”
MPs are due to question the minister for disabled people, Mims Davies, on the government’s failure to tackle carer’s allowance overpayments when the Commons work and pensions select committee meets on Wednesday morning.
Carer’s allowance is the main UK carers benefit. To be eligible, carers must provide at least 35 hours of unpaid care a week. About 1 million unpaid carers receive the benefit, of whom about 175,000 also work part-time on top of their caring duties.
The new figures show 34,500 unpaid carers incurred overpayments last year, up from 30,700 in 2022-23. The figures will raise pressure on ministers to act on shortcomings they have known about for decades and which in 2019 they told MPs they were “determined to address”.
The number of carer overpayments has fallen below 30,000 annually just once since 2019 when MPs first criticised the DWP’s handling of the issue. In 2020-21, overpayments fell to 20,000 when carer’s allowance unit staff were seconded elsewhere to cope with a surge in universal credit claims.
The Carer’s Trust’s director of policy, Dominic Carter, said: “The DWP’s actions will push many [carers] over a financial cliff edge. The government must finally listen to carers’ concerns and urgently overhaul carer’s allowance. The current system simply isn’t fit for purpose.”
A DWP spokesperson said: “Carers across the UK are unsung heroes who make a huge difference to someone else’s life and we have increased carer’s allowance by almost £1,500 since 2010.
“Our most recent statistics show that carer’s allowance overpayments relating to earnings represents 2.1% of the £3.3bn we spend supporting those who look after loved ones.
“Claimants have a responsibility to inform DWP of any changes in their circumstances that could impact their award, and with safeguards in place to manage repayments, this ensures fairness in our welfare system.”
