The reform of carer’s allowance – a benefit paid to people who spend 35 or more hours a week caring for a disabled relative – is overdue and welcome. The cliff-edge design that forces claimants in England and Wales to forfeit their entire payment if they breach an earnings limit of £204 a week by as little as a penny is wrong in principle and made much worse by the appalling way in which rules have been applied. A Guardian investigation revealed that the Department for Work and Pensions (DWP) failed to warn thousands of people who it knew were being overpaid.
This resulted in debts and hardship, and hundreds of criminal convictions for fraud. Carers in already difficult personal circumstances described feeling driven to desperation and illness by what one called a “catch-out culture”. Most claimants are women on low incomes; the allowance is £86.45 a week.
The plan to replace this outdated, blunt tool with a taper is a good one. The disincentive to employment built into the existing system is perverse. Adults with caring responsibilities should be encouraged to do paid work in addition to their roles at home if they can.
As with child benefit, the promised taper will mean that earnings over the threshold lead to a diminution rather than a loss of the allowance. Demands for repayment should be drastically reduced. Thousands of low-income households with disabled members will gain more freedom as a result.
Details of the policy’s implementation have yet to be set out. But after years of delay and inaction, the main concern is timing. A DWP whistleblower first raised the overpayment issue a decade ago, only for their complaint to be shut down.
Successive Conservative governments did nothing despite a detailed 2020 report from the work and pensions committee. Finally, last November, Liz Sayce’s independent review led to the recruitment of extra staff and a new approach. Ministers committed to correcting past errors, including the way that claimants had been unlawfully blocked from averaging their earnings.
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