Carer’s Allowance

Margaret Greenwood Excerpts

Monday 22nd April 2024 Westminster Hall

[Margaret Greenwood (Wirral West) (Lab)]

It is a pleasure to serve under your chairmanship this afternoon, Ms Elliott. I congratulate my hon. Friend the Member for Neath (Christina Rees) on leading this important debate on behalf of the Petitions Committee. I thank my constituents who have signed the petition that we are debating today, which calls on the Government to increase the amount of carer’s allowance to match pay for a full-time job.

Unpaid carers provide vital support to those they care for, whether a family member, friend or neighbour, and they make a huge contribution to our society in general. It is therefore important that they are valued properly. The petition points out:

“Many unpaid carers have to give up work to provide care, and being a carer can also have a significant impact on carers’ wellbeing and lifestyle.”

Census data suggests there are around 5.7 million unpaid carers across the UK, but research from Carers UK in 2022 estimated that the true number of unpaid carers could be as high as 10.6 million. It is thought that one in seven people in the workplace in the UK are juggling work and care.

We know that many unpaid carers have faced enormous pressure on their personal finances as a result of the cost of living crisis, which has caused stress and anxiety for them, and many have been forced to cut back on essentials such as food and heating. Some have suffered extremely severe financial hardship. According to the Carers UK website, 44% of working-age adults who are providing care for 35 or more hours a week are living in poverty. Carers UK has highlighted research from Petrillo and Bennett that shows that unpaid carers in England and Wales contribute a staggering £445 million to the economy every day, or £162 billion per year. That is a huge amount of money, and as things stand unpaid carers can get £81.90 a week if they care for someone for at least 35 hours a week and that person receives certain benefits.

It is unsurprising that there are calls right across the country for a significant increase in the money that carers receive. The Carer Poverty Coalition, which was set up by Carers UK and is made up of over 130 national and local organisations who have come together to campaign to end poverty among carers, has said:

“The next Government must commission a full review into Carer’s Allowance and its eligibility rules to ensure that it adequately values and supports carers.”

The coalition says that such a review should include, among other things:

“Increasing the level of Carer’s Allowance, so that it better reflects the level of financial penalty carers incur...Exploring different payments for people providing 20, 35, 50+ hours of care, to take account of the intensity of caring…Provide an additional payment for carers of State Pension Age...Scrapping the 21 hour study rule”.

The 21-hour study rule prevents anyone who is studying for more than that amount of time a week from claiming carer’s allowance. Those are all very reasonable and important measures, and they should be part of any such review.

In particular, I call for an end to the cliff-edge situation that faces carers who are in paid employment. At the moment, someone can only receive carer’s allowance if they earn £151 a week or less after tax, national insurance and expenses. If they go over that amount, even by one penny, they lose their entire benefit entitlement. That is leading to a situation whereby there are carers who are unwittingly going over the limit and thus becoming ineligible to continue claiming the benefit. That is particularly the case right now, as the national minimum wage has gone up this month, so I urge carers to check their entitlement as a matter of urgency. I also ask the Minister to say what the Government are doing to ensure that all carers in paid employment are aware of this situation.

Written parliamentary questions that I tabled last week revealed that currently the Government are seeking to recover a total of 156,300 carer’s allowance overpayments. That is over 10,000 more than at roughly the same point last year when I asked for this information. The vast majority of those cases—more than 58%—are for amounts up to £1,000. Three hundred cases are for amounts over £20,000.

It is shameful that the Government have failed to get a grip on this situation over the last year. They are leaving increasing numbers of carers to face mounting debts without taking the necessary action to stop that. It was revealed in the press earlier this month that

“tens of thousands of unpaid carers who look after disabled, frail or ill relatives are being forced to repay huge sums of money to the Government and being threatened with criminal prosecution after they had unwittingly breached earnings rules by just a few pounds a week.”

Of course, there may be some cases of fraud, which always have to be investigated, but many, many of those cases will undoubtedly be the result of human error. Lots of people struggle to navigate the claims system, and many carers are under considerable pressure caring for someone they love. Some carers may also have their own medical issues to manage on top of their caring responsibilities, which adds pressure, causes stress and makes them vulnerable. I also remind the Minister that there are 7 million functionally illiterate adults in this country; for them, to navigate the system is nigh-on impossible.

The Government have said to me that they seek to recover money without causing excessive hardship, but the experience of many carers clearly shows that the opposite is true. There have been reports that the DWP has warned carers that they could face greater penalties if they appeal against fines, and Government officials have been accused of using “threatening and cruel” tactics in this regard. That is truly shameful, and I hope that the Minister will look into those allegations. There have also been reports of carers becoming

“severely depressed, suicidal and self-harming”,

due to the Government’s “abhorrent” approach, after they were ordered to pay back money after mistakenly breaching the earnings allowance. That is a completely unacceptable state of affairs. The social security system should be there to support people, not to cause them stress and push some to suicide.

It is also true that the sheer complexity of the claims system can lead carers into making honest mistakes. The judge in the case of a woman who was being prosecuted after being overpaid carer’s allowance when she took a part-time job on the minimum wage said that she had

“limited understanding of the offence…committed.”

The cliff edge of £151 can have the effect of providing a disincentive for carers to be in work or stay in work. That is in absolutely nobody’s interest at all. Aside from the financial support that such work provides, it gives people a sense of agency within their local community and a sense of identity, and it can be vital for people’s mental health and wellbeing. It is also important for people who are caring for people who might be approaching the end of their life, because when the person who they care for passes away they may want to re-engage with full-time employment, and it is much easier for someone to get work when they are already in work and when their skill level has been maintained.

Clearly, that is something that needs to be included in any review, as do the long waits that carers have reported experiencing when they contact the carer’s allowance unit by telephone for information about the benefit and how to make a claim. Labour has committed to reviewing the system of carer’s allowance, and we need this Government to make the same commitment as a matter of urgency. Along with that, they need to review the level of carer’s allowance. As things stand, too many carers are not getting the support that they need.

In summary, it is evident that there needs to be a large-scale review of carer’s allowance, and that the level of payments that unpaid carers receive needs to be increased. Work must be done to tackle the issue of overpayments. The Government should provide more staff to help clear the backlog, looking into possible overpayment cases, and to use those automated systems that are available. We need to see an end to the cliff edge that renders someone ineligible to qualify as soon as they go a penny over. Unpaid carers need to be recognised for the vitally important and selfless work that they do. They need to be supported and not punished for looking after their loved ones.