The UK government has promised a “new settlement” for unpaid carers, vowing to put an end to the scandal of carer benefit overpayments that has left hundreds of thousands of vulnerable people in huge debt and in some cases facing prosecution.
Ministers are expected to announce the details of an independent review of carer’s allowance, the main benefit for carers, on Monday. The review will look at why the overpayments happened and how the problems can be fixed.
A series of Guardian articles in recent months has revealed how unpaid carers who did part-time paid jobs while looking after loved ones inadvertently ran up repayable debts of thousands of pounds as a result of carer’s allowance design flaws and administrative failures by officials
Stephen Timms, the minister for social security and disability, told the Guardian: “This review, the first of its kind, will look at how we can put things right. It will help us understand why overpayments happened in the first place and how we can stop them happening in the future.”
More than 250 UK unpaid carers risk prosecution over benefit overpayments
He added that the concerns of unpaid carers would be “heard, listened to and addressed” by the review, which will be chaired by the disability policy expert Liz Sayce and is expected to report in early summer 2025.
Timms said: “We want a new settlement, in which our carers are genuinely supported to carry out their sacrificial work. Where admiring stories are told of their service, rather than of unwitting debt accrual and of repayments the carers have had to make. The review will be key to this new settlement.”
Revelations of the often cruel and aggressive sanctions and harsh financial penalties imposed by the Department for Work and Pensions (DWP) on carers who have accidentally fallen foul of earnings rules have caused public outrage and led to comparisons with the Post Office scandal.
So-called “cliff-edge” punishments are handed out for breaching earnings limits, where going just a penny over the weekly limit result in carers having to repay the entire benefit. A carer who earned £1 more than the £151 threshold for 52 weeks would pay back not £52 but £4,258.80.
Hundreds of carers have also been prosecuted for fraud in recent years, or paid additional fines to avoid being referred to the Crown Prosecution Service. In most earnings rule breaches, the DWP would have been automatically alerted but failed to act, resulting in carers unknowingly accruing huge overpayments.
It is unclear whether the review’s terms of reference will enable it to scrutinise the DWP’s controversial policy of criminalising some carers in breach of earnings rules, or whether the DWP – which has always insisted that overpayments are the fault of the claimant – should bear any formal responsibility for earnings breaches it knew about and could have prevented.
Although campaigners have called for a pause on overpayments while the review takes place, it is unclear whether ministers will agree to this, or to calls for carer’s allowance debts to be written off.
Inertia, denial and failure: timeline of the UK carer’s allowance scandal
In April, official figures showed 134,500 claimants were repaying carer’s allowance overpayments, totalling about £250m. Since then, thousands more have fallen foul of the rules and are paying back earnings-related overpayments.
Timms said: “Left to their own devices, often encumbered with caring responsibilities, these carers saw debt surge. Readers of the Guardian will have seen some of the most extreme cases come to light where carers – to whom we owe much gratitude – are pursued for debts, sometimes totalling thousands of pounds.”
He added: “We have seen reports of carers who were unaware of the rules, and intervention was not quick enough to stop them continuing to break them.”
The government has already moved to address some problems with carer’s allowance, announcing in the budget a record increase to the earnings limit to £196 a week from next April, and promising to fix the cliff-edge penalty rules.
Helen Walker, the chief executive of Carers UK, said she was “delighted” to see the review getting under way. “It is vital that we see 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,” she said.
Carer’s allowance, worth £81.90 a week, is claimed by just under 1 million unpaid carers in the UK who look after disabled, frail and ill loved ones for at least 35 hours a week. Most are women and a high proportion are in poverty.
