(3 weeks, 4 days ago)
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Baroness Pitkeathley
To ask His Majesty’s Government whether they plan to review their policy of fining carers who inadvertently break the earnings limit rule when claiming Carer’s Allowance.
Baroness Pitkeathley (Lab)
My Lords, I beg leave to ask the Question standing in my name on the Order Paper and draw attention to my interests as set out in the register.
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Viscount Younger of Leckie) (Con)
My Lords, while fully recognising and valuing the vital contributions made by carers every day in providing significant care and support, claimants have a responsibility to ensure that they are entitled to benefits and to inform DWP of any changes in their circumstances that could impact their award. Where benefits are overpaid, it is our policy to recover that money, where reasonable, and to set affordable and sustainable repayment plans that do not cause undue hardship.
Baroness Pitkeathley (Lab)
My Lords, talking of undue hardship, I hope the Minister will now confirm the figures, which were finally released last week, that more than £250 million is being clawed back from more than 134,000 carers. In 2019, the DWP promised that its new automated system would stop overpayments and warn carers in time. Does he agree that it is unacceptable that carers are being prosecuted in this way? Does he also agree that what is needed is, first, an amnesty for carers who have been overpaid through no fault of their own and, secondly, a thorough review of carer’s allowance, so that carers are neither prosecuted nor persecuted for trying their best to combine paid work with their caring responsibilities, thus propping up the whole social care system on behalf of us all?
Viscount Younger of Leckie (Con)
I think I should just reiterate that the Government thoroughly recognise and value the vital contribution made by carers, but it is also the case that, if a claimant incurs an overpayment due to payment error or fraud, this overpayment will need to be repaid and, in some cases, as the noble Baroness will know, a penalty will be charged. However, we carefully balance our duty to the taxpayer to recover overpayments and safeguards are in place to manage repayments fairly. Some overpayments will attract no penalty at all, and I can certainly expand on the safe- guards that we have in place.
Baroness Tyler of Enfield (LD)
My Lords, is the Minister aware that the chair of the Work and Pensions Select Committee has written to the comptroller of the National Audit Office asking the NAO to conduct a second inquiry into carer’s allowance overpayment, five years after the initial investigation in 2019? Would the Government welcome such an investigation and how quickly could it be set up?
Viscount Younger of Leckie (Con)
I have to say that the gist of the argument that came from the noble Baroness’s question is, “What is going on?” I can tell her that around 1 million people are in receipt of carer’s allowance and that the vast majority of them—around 95%—were paid correctly. I do not entirely accept the statistics that the noble Baroness mentioned: the total overpayment rate for carer’s allowance was 5.2%, which represents about 60,000 people. About half of them ended up being given a penalty of £50—the basic civil penalty.
Baroness Andrews (Lab)
My Lords, on the statistics, can the noble Viscount tell us how many people owe more than £20,000? When he talks about responsibility, will he agree that the problem is that we have another instance where the information technology system has got away from human judgment? The IT system does not trigger action, so carers may wait months and months to be told that they owe significant amounts. The evidence now suggests that one of the effects of this is that some carers are not going to claim carer’s allowance because it is too risky. They are facing so much stress and this is one element of stress that they simply cannot handle.
Viscount Younger of Leckie (Con)
Although I do not have the figure to pass on to the noble Baroness, I can say that the other main category for overpayments comes under the title of “conditions of entitlement”. That represents 2.8% of the total. This is when claimants have stopped caring and neglected to tell us, or when the claim has been fraudulent from the outset. I am aware of some extreme cases highlighted in the press—which, by the way, have been building up over many years—where the amount of repayment is particularly high. That amount is not particularly high, but I will certainly get the figure to the noble Baroness.
Baroness Sherlock (Lab)
My Lords, let me give an example. Carer’s allowance is a cliff-edge benefit. If you are caring for 35 hours a week and you earn £151 a week or less, you get the lot. If you earn £1 more, you get nothing. So the people the Minister is talking about include someone like Helen, who cared for her parents for 10 years. She breached the earnings rule because she worked in a hospital. They used to dock her wages automatically to pay for her parking. When they stopped doing that, her net pay went up. She was over the earnings limit by an average of £2 a month for two years, and she was told to pay back £1,700. DWP has known about this for years. Why is it not telling carers before they get into this kind of debt?
Viscount Younger of Leckie (Con)
I think the noble Baroness will know that, each year, there is an uprating letter, so the communication is there for individuals. However, it is fair to say that we are looking at what more we can do to help our customers. I say again that it is their responsibility to tell us whether they exceed the earnings limit. Equally, we are looking to see whether, for example, under the RTI, the information that we receive instantaneously from the HMRC can be utilised so that we can send a text to customers. This is something that we are looking at very seriously— so her point is well made.
Baroness Buscombe (Con)
My Lords, I have great sympathy with what the noble Baroness, Lady Sherlock, has said in terms of communication. Every department can always do better in that and use every form of technology and so on to make sure that people know where they stand. However, would my noble friend not agree, and in support of what my noble friend is saying, that the Government have to be vigilant? We will get an income tax take in this country this year of only around £279 billion, and the bill just for the Department for Work and Pensions will be £300 billion. That is one department. It is vital, is it not, that the Government are vigilant and really crack down on those people who genuinely should not receive—
Baroness Buscombe (Con)
No, I am sorry, I am talking about those who should not receive. I did not say “carers”; I am saying those who should not be in receipt of benefits.
Viscount Younger of Leckie (Con)
Indeed. I think I have made it clear already that we need to be fair. We need to balance carefully our duty to the taxpayer to recover the overpayments with safeguards in place to manage the repayments fairly. I am the first to say that some carers are among the most vulnerable people in society. Where they have got themselves into difficulty and gone over the limits, it is their duty to tell us and we have an important job to do in these situations to help them with their repayments. We have made some very good progress on that, but I have made the point that in terms of communications there is more to be done.
Baroness Smith of Llanfaes (PC)
My Lords, I myself was a young carer for my late father and I understand how such additional responsibilities can limit your options for a stable income. Does the Minister acknowledge that unpaid carers are disproportionately affected by poverty? Will he explore longer-term solutions to bring more unpaid carers out of poverty, such as reforming the much-needed carer’s allowance?
Viscount Younger of Leckie (Con)
The noble Baroness makes a very good point. Each carer has his or her own responsibilities, some of which are very great, involving permanent lack of sleep. However, it is very important that, if they can, they should lead for themselves fulfilling and rewarding lives. That is why we have a number of initiatives to encourage carers to do some work. We think that it is good for them, and they acknowledge that. Clearly, this is a very important part of what we do in our department.
Baroness Watkins of Tavistock (CB)
My Lords, we all acknowledge that caring is an extremely stressful occupation and that it is really good if carers can spend some time at external work. We know that it is good for their mental health. The responsibility of paying something like £1,500 back in a short period is more than stressful; it tips some people into becoming so mentally ill that they can no longer go to work. Can the Minister go back to the department and agree the number of people who should have their debt written off and that those not in that category should pay no more than £5 a week?
Viscount Younger of Leckie (Con)
We certainly do not agree with the idea that any of the debt should be written off; we think that the debt is there to be repaid. However, as I have said, we have a number of plans in place on a one-to-one basis to help each individual who has got into difficulty, to help them to repay that debt. That is a very important point.
Baroness Lister of Burtersett (Lab)
My Lords, my noble friend Lady Pitkeathley called for a fundamental review of carer’s allowance, as has the Work and Pensions Committee. We need a review that looks not just at the cruel rules but at the purpose of carer’s allowance, all the eligibility rules and the level of carer’s allowance, which is one of the lowest benefits of its kind.
Viscount Younger of Leckie (Con)
The noble Baroness will know that we keep these matters under constant review and that the carer’s allowance is a non-means-tested benefit, with no capital rules, in England and Wales, which means it does not depend on the payment of national insurance contributions but is funded from general taxation.
I would also say that, for the claimant to be able to earn up to £151 per week, we need to take account of the allowable expenses. So that £151 can be stretched, in effect, by taking account of national insurance, tax and other allowable expenses.