Carer’s Allowance

Wendy Chamberlain Excerpts

Wednesday 16th October 2024 Commons Chamber

[Mel Stride]

The hon. Gentleman makes an important point, and of course the motion states that there should be an increase—an unspecified amount, but it is there none the less. I think the answer to his question is that it is a balance, because the higher we put up the earnings limit and the more generous we are to carers, which of course is something we all want to do, the more people can earn and the longer they can work. Potentially, therefore, if this is acting as a proxy for the amount that people are working, they might not have the real time to spend 35 hours a week caring for a loved one. So it is inevitably a balance. I certainly accept that this is worth reviewing, and I note that the Minister for Social Security and Disability, the right hon. Member for East Ham (Sir Stephen Timms), when he chaired the Work and Pensions Committee, called forcefully for a significant increase in the level of carer’s allowance.

[Wendy Chamberlain (North East Fife) (LD)]

The right hon. Gentleman has obviously set out a number of the adjustments that need to be made, but in doing so he has outlined just how complex the system is and therefore exactly why we have had the scandal in the first instance. Does he agree that we should be asking the Minister to ensure that in the carer’s allowance review we simplify this process? I can assure him that many unpaid carers are not doing 35 hours a week.

[Mel Stride]

Indeed. What we want, ideally, is a system that is as simple as possible. The motion suggests that we bring in a taper, but that would be a complication of the system. I will come to why there are problems with that. It is easy to suggest these things, but the detail often makes them really quite complicated.

The last Government made it clear, when someone applied for this particular benefit, exactly what the arrangements were. When uprating occurred every year, we wrote to everybody to explain the uprating and to inquire as to whether any changes in their circumstances or earnings might impact their entitlement to benefits. And it was we, not this Government, who in our May update to our fraud plan brought in the pilots for texting to alert those on carer’s allowance that they may—I say “may” because the Department will not know—be close to exceeding the earnings limit. I am pleased that the Minister has indicated that the Government will continue with our fine work, but let us be very clear who it was that started those particular measures.

--- Later in debate ---

[Wendy Chamberlain (North East Fife) (LD)]

I declare an interest as I am in the process of joining the board of Fife Carers in an unpaid capacity; it is a privilege to join the organisation. I have worked with unpaid carers throughout the past few years, as constituency MP for North East Fife and through the passage of my private Member’s Bill that became the Carer’s Leave Act 2023. If hon. Members want to learn more widely about carers, they may wish to read my Adjournment debate on the subject, which took place in the first few weeks of this Parliament, where I talked about the need for a strategy on carers to ensure that carers get the cross-cutting governmental and departmental support they need.

I will not touch on the overpayments scandal specifically, but I welcome the announcement of the review after months of campaigning by my dear friend the Leader of the Liberal Democrat party, my right hon. Friend the Member for Kingston and Surbiton (Ed Davey), as well as by the Liberal Democrats, carer charities and journalists. However, I want to raise some points about the carer’s allowance more generally.

I recently asked the Minister responsible for carer’s allowance, the right hon. Member for East Ham (Sir Stephen Timms), a written question about a review of how carer’s allowance is working. The response said:

“This government will keep eligibility criteria and processes of Carer’s Allowance under review, to see if it is meeting its objectives.”

That response poses more questions than it provides answers. What are the Government’s objectives for carer’s allowance? Are they ever reviewed? How do they know if they are meeting them? What metrics are being used? What would happen if it was found that the objectives were not being met?

I assume that the objective of carer’s allowance is to keep unpaid carers out of poverty, given the additional barriers they face to working and the additional costs they face through their caring. I also assume that we want to help unpaid carers to stay linked to the workplace, if possible, through part-time work or training. On any assessment, carer’s allowance is failing these objectives. It is a failure when a third of households in receipt of carer’s allowance are classed as food insecure, compared with 10% of households as a whole; when Carers UK research from 2019 found that 600 people per day who were caring were giving up work; and when the rate of poverty among unpaid carers is 50% higher than among non-carers.

One immediate remedy that could be considered, as is set out in our motion, is an increase in carer’s allowance. It may not seem much in the big scheme of things, but during the pandemic we saw the impact of the £20 uplift to universal credit, which delivered an immediate and marked fall in food bank use.

We must do all we can to support people into work and to stay in work, so that they are not relying on carer’s allowance to get by. That point refers to the earnings allowance, which stops carers from working more than 13 hours a week on the minimum wage before losing carer’s allowance. As has already been discussed, there is no taper rate, so as soon as carers earn a penny more, the allowance goes.

Bizarrely, yearly increases to the allowance are not pegged to changes to the national minimum wage. Historically, people could work for 16 hours before they lost carer’s allowance; some of the scandal we have seen could be because people have continued to make those assumptions. We need to take the complexity out of the system. It is completely reasonable for people to assume that if they are earning national minimum wage and receiving carer’s allowance in one financial year, they can continue to do so in the following financial year, as long as they do not increase their hours, but that is not how the system works. The national minimum wage went up by 9.8% this year, but the earnings allowance did not go up at all. That sounds to me like a system set up to make people fail.

Should we not be enabling people to take on more hours and to progress in their jobs if they can? We know that often people—especially those who are below or near the poverty line, as too many unpaid carers are—are scared to risk losing their benefits in case that does not work out. One of the unseen outcomes of the scandal is that people are simply not looking for work or to get into employment because they are scared about the consequences.

Many young carers have high levels of absence from school and there are barriers to them accessing education. Potentially, if we do not help them to claim carer’s allowance when they are entitled to do so, they will never go into work and be able to make a contribution. Fife Young Carers, in my constituency, supports people up to the age of 25. We want to encourage young carers to complete their education so they have the best possible options later.

To return to my cross-cutting strategy, the Department for Work and Pensions may think that it is for the Department for Education to support young people. However, as the hon. Member for Salford (Rebecca Long Bailey) said, under the under-21 rule, doing a vocational qualification could preclude somebody from receiving carer’s allowance, as T-levels are one of the qualifications that falls into that trap. She is right that we need to think about how we are potentially inhibiting those young people in employment and training from moving forward. We need to ensure that we improve young people’s outcomes.

The Minister will know that employment among unpaid carers is about more than just benefits. We welcome her reference to the Carer’s Leave Act 2023 in her opening remarks and the fact that the Government are looking for that leave to be paid, which has long been a party policy of the Liberal Democrats. However, I do have to express my disappointment that there was no sign of paid leave in the Employment Rights Bill, because there was a real opportunity there to move the matter forward. I would appreciate it if, in her closing remarks, the Minister provided an update on the likely timescales in relation to the Carer’s Leave Act. I am concerned that, since the implementation of the Act, we do not actually know what the take-up of carer’s leave is. I am hearing worrying anecdotes that, six months after the legislation was fully implemented, some companies are still not aware of, or properly recording, carer’s leave. Part of that is because the communication from the then Government was not good enough. Unless somebody was starting a small business, or actively looking for these details, they would not find anything on carer’s leave.

I would like to raise one final point with the Minister. Again, the hon. Member for Salford highlighted this. I am often contacted by constituents who are upset to find that, having retired, they have lost their carer’s allowance—or, in Scotland, the carer support payment—because they are claiming their state pension. We know that female pensioners are more likely to be in poverty because of the working life that they have had—or not had—as a result of raising their families, and that unpaid carers are more likely to be female and older. I would like the Minister to pick up on that point, because too many pensioners are in poverty this winter as well as carrying caring responsibilities.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call Gill German to make her maiden speech.