Dawn Bowden, Minister for Children and Social Care
We welcome the announcement by the UK Government of the publication of the Independent Review of Carer’s Allowance Overpayments by Liz Sayce OBE, regarding concerns that some unpaid carers had accrued significant overpayments by exceeding the earnings limit of Carer’s Allowance,
The independent review and the UK Government’s response to the Review’s recommendations were published on 25 November.
I welcome the thoroughness of these reports and the commitment to make positive changes where the benefit system has let people down. The review found that mistakes were made by the Department for Work and Pensions in applying the rules on the averaging of earnings, when carers’ pay fluctuates. This means some carers were wrongly asked to repay their Carers Allowance.
I understand the UK Government will be undertaking a re-assessment process where carers who have wrongly been asked to repay Carers Allowance will have this returned to them. Plans for this review will be announced by the DWP in the New Year and we ask carers not to contact the DWP at this time.
While it is expected that a relatively small proportion of unpaid carers have been affected, this will have been a very upsetting experience and will have impacted household finances, which were already under pressure. I have written to Sir Stephen Timms, Minister for Social Security and Disability for more information on the numbers affected in Wales.
I am pleased the UK Government has committed to exploring the potential to change the rules for Carer’s Allowance, to reduce the impact of the ‘cliff edge’. Currently, carers lose their entitlement if their pay exceeds the earnings threshold, even by a small amount. We want to do all we can to support unpaid carers to stay in paid employment, where at all possible.
We welcome the further steps being taken to automate the handling of earnings. This should reduce the chance that carers will be unaware they have exceeded the earnings threshold, which they must repay when identified.
Carer’s allowance is paid to unpaid carers aged 16 or over who provide care for at least 35 hours per week. The person cared for must receive a qualifying disability benefit and the earnings threshold for carers in paid employment was substantially increased in April 2025 from £151 to £196 per week.