Action to stop the scandal of carer’s allowance overpayments and delayed clawback is required urgently, MPs warned, adding that overpayments “remain a significant issue” for unpaid carers that also work.
A number of carers have been hit with huge repayment demands after they exceeded the earnings limit for carer’s allowance without realising.
Today, the Work and Pensions Committee urged the Department for Work and Pensions (DWP) to urgently improve the way it monitors and communicates carer’s allowance overpayments.
The scandal of overpayment clawbacks has hit the headlines in recent weeks highlighting that the benefit “is not fit for purpose”, said Carers UK.
Unpaid carers that work and, as a result, exceed the benefit’s earnings limit of £151 a week are no longer entitled to the payments of £81.90 a week. The DWP has been heavily criticised for allowing the ineligible payments to continue for long periods, in some cases years, resulting in people racking up huge debts without knowing.
In a letter to the Work and Pensions Secretary Mel Stride, the select committee said there has been no progress in limiting the impact of the problem since it was flagged up by a previous committee report five years ago.
MPs said overpayments remain a significant issue for carers, as they emphasised their concerns about the mental distress experienced by people who find they have been overpaid but that the DWP has taken several years to recover the money.
MPs welcomed the government announcement on Monday that it would consider contacting people that been overpaid via email and text messages. However, the letter said it is imperative that the changes are introduced without delay or a lengthy process of trials.
The committee reiterated the recommendation, in its Benefit levels in the UK report, that carer’s allowance should be benchmarked against living costs. It also voiced concerns about the relationship between the benefit and work, and recommended the introduction of a taper rate, and highlighted the importance of ensuring the benefit supports young adult carers.
Stephen Timms, chair of the committee, said: “The government has known for years about flaws that have plagued the payments system for carer’s allowance but has just allowed many unpaid carers to unwittingly rack up unmanageable levels of debt. The DWP must now move without delay to get a grip of the problem and ensure carers are no longer subjected to the distress that such overpayments can cause.
“On top of the problems with overpayments, we have heard how the rate of carer’s allowance leaves many struggling to make ends meet. The government should make sure that carers who carry out their tasks without reward are made to feel valued by ensuring that the payment properly reflects living costs.”
The committee’s comments followed evidence sessions on carer’s allowance in March and April.
