Contact welcomes review of Carer’s Allowance overpayments

2 mins read

Thursday 17 October 2024

Tags: carer's allowance, earnings limit, overpayments, carer's allowance campaign, department for work and pensions

The government has announced an independent review into the overpayment of Carer’s Allowance.

Parent carers are among the 156,000 unpaid carers from whom the Department for Work and Pensions (DWP) is attempting to claw back overpayments. Many are having to pay back hundreds or in some cases thousands of pounds, pushing them into financial hardship.

Anna Bird, Contact’s Chief Executive, said:

“Contact welcomes the government’s review of Carer’s Allowance overpayments. For many years, we have been highlighting the cliff edge of the Carer’s Allowance earnings limit. Not only is it a disincentive to work, it also leads to overpayments, which can add to the stress and financial difficulties that families with disabled children are under.”

Eligibility for Carer’s Allowance includes a maximum weekly earnings threshold of £151 a week. In some cases, carers have unknowingly had their earnings rise above this limit, perhaps after a small pay rise. They’ve discovered the error only when years later the government has notified them that it will reclaim the full overpayment.

By this stage, the overpayment can amount to a significant sum. We have heard from families who have gone over the threshold of the earnings limit by a few pence, but have to pay the full amount of the allowance back.

Other parents have contacted the DWP to inform them of a change in circumstance, only for officials to say there is a backlog, and it could take weeks to update the system. So despite doing everything correctly and notifying the department, carers are wrongly receiving their allowance.

The government review will look at why the overpayments were made, and what can be done to stop it happening.