Next Steps On Addressing Carer’s Allowance Overpayments Announced
The government has announced the next steps with a major review of the Carer’s Allowance as it aims to put an end to the controversy of carer benefit overpayments that have landed hundreds of thousands of people in debt.
In October, Work and Pensions Secretary Liz Kendall announced that a review would take place into issues with the Carer’s Allowance, following increasing reports of carers unknowingly accruing large amounts of overpayments of the allowance and finding themselves in crippling levels of debt.
- Review terms of reference published marks an important next step to help unpaid carers across the country
- An independent review to investigate earnings related Carer’s Allowance overpayments was announced in mid-October
- Publication of Terms of Reference follows changes to the earnings threshold announced in the Budget which will benefit more than 60,000 carers by 2029/30
The Independent Review of Carer’s Allowance takes its next step to supporting unpaid carers by publishing its terms of reference today [Monday 9 December].
The review – announced by Work and Pensions Secretary Liz Kendall earlier this year and led by Liz Sayce OBE – was established to investigate the reasons why overpayments have occurred for some carers as part of our mission to rebuild Britain and support working people.
It follows concerns over reports of carers unknowingly accruing large amounts of overpayments of Carer’s Allowance, signalling the Government’s commitment to learn lessons and get to grips with the issues.
Now the scale and scope of the review has been confirmed with the publication of its terms of reference.
It will explore:
- How overpayments of Carer’s Allowance linked to earnings accrued and why this has happened
- What changes can be made to reduce the risk of such overpayments accruing in future
- What DWP can best do to support those who have already accrued overpayments
Minister for Social Security and Disability, Sir Stephen Timms MP, said:
“Carers wishing to pursue more financial independence should be encouraged to do so and not be unknowingly punished.”
“We need to get to the bottom of what has been going on. Publication of the terms of reference is the next step in this important work. The Review also builds on the action we’ve already taken to boost the earnings threshold which will benefit more than 60,000 carers.”
The review is expected to deliver its findings and recommendations to ministers by Summer 2025.
Chair of the independent review, Liz Sayce OBE, said:
“I’m pleased my important work on this review is now starting in earnest. I have already started to hear from carers about the impact overpayments have had on them, in a context in which people face multiple pressures in their lives. I will be collecting views and evidence as I review the issues and develop recommendations.”
“In doing so, I will be able to advise the Government on ways to minimise overpayments of Carer’s Allowance related to earnings accruing in future and how it can best support those already affected.”
“Action has already been taken by the Government by boosting the Carer’s Allowance earnings threshold by £45 a week to £196, benefitting more than 60,000 carers by 2029/30. This is the biggest ever cash increase in the earnings threshold for Carer’s Allowance.”
Helen Walker, Chief Executive of Carers UK, said:
“We are delighted to hear that this important review into the Carer’s Allowance overpayments scandal will now be getting underway quickly and we will be a step closer to changing a broken system which has seen more than 134,000 unpaid carers paying off debts and many experiencing emotional distress and hardship as a result.
“We know many carers who have been impacted are keen to share their story with the chair of the independent review, Liz Sayce OBE, and we look forward to submitting the evidence we have gathered on the issue from over 160 carers affected by overpayments.
“It is vital that we see clear recommendations and changes implemented quickly so we can prevent as many overpayments as possible from happening in the first place, as well as reducing the size of the debt for unpaid carers, who are often living in very challenging financial circumstances.
“We hope that the independent review will look carefully at the harsh ‘cliff-edge’ nature of the earnings limit in Carer’s Allowance whereby exceeding the limit by a tiny amount means having to pay back the whole benefit, as well as considering what could be done to reduce the burden on carers who have existing large debts and could have been notified sooner by DWP. We look forward to seeing its conclusions early next summer.
“While not within the scope of this review, we would like to see further work by the Government to assess the adequacy of Carer’s Allowance and other financial support for unpaid carers to ensure they are properly supported, whatever their circumstances, whilst they provide vital care for others.”
