Committee investigating DWP recovery of carer overpayments

23 November 2018

It has recently been reported that DWP is pursuing thousands of recipients of Carer's Allowance for overpayments of the benefit, in some cases relating to payments made years ago.

It has recently been reported that DWP is pursuing thousands of recipients of Carer's Allowance for overpayments of the benefit, in some cases relating to payments made years ago. The DWP estimates that it overpays £160 million in Carer's Allowance on an annual basis and is now looking to recover that money. This means that many carers could have to repay up to thousands of pounds, or face more serious action; 1,000 carers could face prosecution and up to 10,000 may face fines. The Committee has decided to investigate and launched an online survey to gather the experience of claimants' who have been contacted by the Department about overpayments.

There are 6.5 million unpaid carers in the UK who make a hugely valuable contribution to society. Many carers will be entitled to Carer's Allowance, but this Committee has previously reported on the “cliff edge” within this benefit; if someone earns just £1 over the earnings threshold, they lose 100% of their Carer's Allowance. It has been reported that many carers are often not aware that a rise in their earnings has taken them over this threshold. This means that they could, inadvertently, continue to receive Carer's Allowance when they are no longer eligible, resulting in an overpayment.

The Committee will hold a one-off evidence session next week with Emily Holzhausen OBE, Director of Policy and Public Affairs at Carers UK, to explore why the levels of overpayments in Carer's Allowance are so high, how clear the rules around earnings for carers are, and the impact that repaying overpayments has on carers. It has also written today to DWP (attached) to gather some information about the causes of the problem and the Department's approach to reclaiming the overpayments, including how many claimants it intends to prosecute. DWP last assessed rates of overpayment of the benefit over 20 years ago, and it is therefore difficult make any assessment of how many of the overpayments are due to fraud rather than genuine error.

Committee Member's comments

Commenting, Committee Member Ruth George MP said:

"Our health and social care systems would fall apart without the contribution of unpaid carers, who perform a selfless and invaluable role for at least 35 hours a week to qualify for the £64.80 carer's allowance – that's a maximum £1.85 an hour. When I worked with retail staff, we would often see someone get a small pay rise and inadvertently exceed the earnings threshold. It was bad enough when this was picked up at the end of the year and they had to find and pay back hundreds of pounds. When carers are only being informed of overpayments years later and potentially being taken to court for thousands of pounds, it is imperative for the Committee to look at the evidence and question whether Government is acting in the best interests not just of individuals, but of society and the wider economy."

The Committee conducted an inquiry into Support for carers including Carer's Allowance, earlier this year and was deeply disappointed by the Government's “non-response” received in July – Committee Chair rejects Government "non-response" on support for carers – which the Chair said “has barely paid lip service to an issue that is central to the lives of millions of people. I am sure it can do better for this country's heroic and undervalued carers as well as their families. So we have taken the unusual step of inviting Government to go away and try again."

It is now publishing the further response from DWP, as well as follow up on some of the greater remaining concerns, such as the benefit's in-built “cliff edge”. The Committee is pursuing the possibility of introducing a “taper” such as that which operates for other benefits like Universal Credit, whereby the benefit is reduced as earnings increase.

Further information

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