DWP rule change in Budget will offer thousands of people £4,258 a year

Changes to Carer's Allowance could soon make tens of thousands of more people eligible for the payment, worth £4,258 a year. The Government plans to increase the upper earnings limit for the benefit, currently set at £151 a week, meaning more carers will be eligible for the DWP benefit, which pays £81.90 a week, or £4,258.80 a year.

The upper earnings rule has led to many claimants being overpaid, with some 134,800 people owing funds to the DWP as of May 2024, mostly due to carers breaching the earnings limit. The current rules state that your income must not exceed £151 a week after tax and expenses are deducted.

Carers UK previously warned that many claimants were unknowingly being overpaid as they were "not understanding the rules". The Government is set to carry out a formal review into the overpayments scandal.

Suzanne Bourne, head of Carer Support at Mobilise, said: "It is especially important to be aware of exactly how much you earn - this earnings ‘threshold’ is where the recent issues have come from. Currently, it’s up to the individual to check they are not exceeding this limit to avoid having to repay any overpayments. Although there are plans to automatically alert people at risk of falling into this trap, this is not yet the case."

To be eligible for Carer's Allowance, you have to care for someone for at least 35 hours a week and they must be on a qualifying benefit. The person you care for needs to be on one of these benefits:

• Personal Independence Payment - daily living component
• Disability Living Allowance - the middle or highest care rate
• Attendance Allowance
• Constant Attendance Allowance at or above the normal maximum rate with an Industrial Injuries Disablement Benefit
• Constant Attendance Allowance at the basic (full day) rate with a War Disablement Pension
• Armed Forces Independence Payment
• Child Disability Payment - the middle or highest care rate
• Adult Disability Payment - daily living component at the standard or enhanced rate.

Mobilise offers a Carer's Allowance checker tool to find out if you can claim the DWP benefit. A previous Carers UK report found that carers often exceed the earnings limit for Carer's Allowance due to fluctuating earnings, pay rises, or employer errors such as late payments.

One carer described the stress caused by demands from the DWP to repay overpayments: "It pushed me over the edge as the letters were very threatening and on top of my caring responsibilities it made me ill. I was scared and felt under constant threat from debt collectors and being taken to court."

Carers UK advocated in the report for an increase in Carer's Allowance by at least £11.10 a week and for the earnings threshold to align with 21 hours a week at the National Living Wage.