Carers UK is reacting positively to the news that the Government is planning to text or email carers who are at risk of overpayments on Carer’s Allowance, but is warning that the DWP needs to invest in good advice, information and staffing to make sure that it works well for unpaid carers. Unfortunately, the changes will not change some of the underlying problems with the policy in the first place which needs tackling urgently.

In recent weeks, the scandal of overpayments has highlighted the fact that Carer’s Allowance, as a benefit, is not fit for purpose.  By going even £1 over the earnings limit of £151 per week, unpaid carers in receipt of Carer’s Allowance stand to lose 100% of their benefit worth £81.90 per week. Many carers unwittingly went over the earnings limit, many didn’t inform the DWP, which then resulted in an overpayment of Carer’s Allowance. The DWP, however, receives regular alerts from HMRC telling them who has gone over the earnings threshold, but does not notify the carer. Their lack of action can go on for years, effectively allowing the unpaid carer to clock up massive debts to the DWP, some running into tens of thousands of pounds.

In their strategy document, Fighting Fraud in the Welfare System, the Government has said the following:

“In Carer’s Allowance we are progressing an enhanced notification strategy as part of our existing commitment to improve customer engagement, building on our existing communications with customers. As part of this notification strategy we are considering all forms of targeted contact to find the most effective and efficient solution, such as exploring the use of targeted text messages or emails to alert claimants and encourage them to contact the Department when the DWP is made aware of a potential overpayment. The new strategy will help claimants understand when they may have received an earnings-related overpayment or are at risk of doing so, and will encourage claimants to contact the DWP to meet their obligation to inform the Department of changes in their income and other relevant circumstances. This will reduce the risk of those customers being overpaid.

Emily Holzhausen OBE, Director of Policy and Public Affairs at Carers UK said:

“It is welcome that DWP are finally looking at a better way to inform unpaid carers when their earnings might be going over the earnings limit for Carer’s Allowance. This is the minimum that we’ve been calling for in our campaign to get the DWP to tackle the terrible situation of carers’ overpayments which causes so much distress and heartache for unpaid carers who are already under a great deal of pressure.  It has the potential to help carers who find themselves caught out when they don’t spot a small increase to their wages and end up with huge Carer’s Allowance overpayments debts.

“If carers are alerted to an overpayment, then it is vital that DWP invests in adequate staffing and practical resources to provide unpaid carers with information and advice on the potential earnings breach to ensure that they fully understand the allowable deductions they are entitled to. DWP also need to be able to act quickly on information supplied by unpaid carers – another issue that we’ve seen time and again from carers who inform the DWP but action is not then taken promptly.

“The next question is when the DWP is going to implement this. This is urgent. With every week that passes, more carers run the risk of building up overpayments that could have been avoided.

“This action comes 5 years after the National Audit Office report, which recommended improvements to the system back in 2019 – why could this not have been done sooner? It will also not help many carers who are already paying back debts, like the 34,500 carers who had overpayments just in the last year. 

“We’d like this whole issue to be moved out of being branded benefits fraud, bringing in more compassion and recognising that carers are often vulnerable.  DWP has a responsibility to ensure that its customers or clients have the best service possible.

“This step, however, still doesn’t tackle the fundamental complex and challenging benefit rules for Carer’s Allowance.  The benefit needs a fundamental review including an increased earnings limit, taper and should be modernised to reflect the realities of caring."