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Carer’s Allowance Overpayments
14 April 2026
Lead MP
Anna Dixon
Shipley
Lab
Responding Minister
Stephen Timms
Tags
Social CareTaxationEmploymentBenefits & Welfare
Word Count: 4016
Other Contributors: 2
At a Glance
Anna Dixon raised concerns about carer’s allowance overpayments in Westminster Hall. A government minister responded.
Key Requests to Government:
Dixon urged the Government to implement Liz Sayce's recommendations urgently, set a timeline for reforms, introduce a taper system to address earnings limits, and ensure all aspects of maladministration are addressed in the audit of over 200,000 cases.
How the Debate Unfolded
MPs spoke in turn to share their views and ask questions. Here's what each person said:
Lead Contributor
Anna Dixon highlighted the Carer's Allowance overpayment scandal impacting thousands of carers, including Helen who faced a £2,000 debt due to DWP errors. She cited statistics such as 1.2 million unpaid carers living in poverty and 5.8 million unpaid carers contributing £184 billion annually to the UK economy.
Jim Shannon
DUP
Strangford
The Member commends the hon. Lady for bringing forwa [5D [K forward the debate and highlights that the amount of money saved by the Gov [3D [K Government from overclaimed Carer's Allowance is astronomical. He stresses [K the need for discretion when dealing with carers who made unintentional err [3D [K errors, arguing against treating them as criminals.
Rushanara Ali
Lab
Bethnal Green and Stepney
The Member congratulates her hon. Friend on securing [8D [K securing the debate and notes the £184 billion annual contribution of carer [5D [K carers to the country. She draws parallels between this situation and past [K scandals, urging for regular audits by the Department for Work and Pensions [8D [K Pensions to monitor its progress in addressing overpayments. She referred to a Guardian article which stated that [4D [K that the government would maintain its existing policies for overpayment re [2D [K recovery during an overhaul of Carer's Allowance, ensuring penalties contin [6D [K continue. She asked the Minister to confirm whether these penalties will no [2D [K not be imposed.
Government Response
Stephen Timms
Government Response
I am delighted to serve under the chairmanship and congratulate my hon. Friend on securing this timely debate. The Government have inherited a challenging situation where carers faced unexpected debts due to overpayments of Carer's Allowance. We increased the weekly earnings limit in April 2025, resulting in the largest ever increase, allowing more than 60,000 additional people to receive allowance from 2025-26 to 2029-30. 2029-30. This change also reduces the chance of inadvertently slipping above the limit due to national living wage increases. Independent review led by Liz Sayce identified issues with flawed guidance on earnings averaging and we have revised this, setting aside £75 million for refunds over three years starting from September 2025. The reassessment exercise began yesterday, aiming to complete it in two years but allowing three years to ensure thoroughness. We expect to review more than 200,000 cases, reducing, cancelling or refunding debts for approximately 25,000 carers. New and correct guidance is now in place since September 2025. The Government have appointed a senior responsible officer to oversee the delivery of the recommendations with updates every six months to the Public Accounts Committee and Work and Pensions Committee. We are improving communication and clarity for carers on earnings averaging, overpayments, and reporting responsibilities. We aim to reduce the impact of the earnings cliff edge through research and behavioural analysis. We will put in place an automated solution to better join-up Carer's Allowance with Universal Credit and other benefits, reducing burdens on carers. Backlogs are being addressed by faster processing of HMRC alerts. The reassessment exercise is part of our broader response to fix problems and correct mistakes, rebuilding trust through honesty, accountability, and action.
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About Westminster Hall Debates
Westminster Hall debates are a chance for MPs to raise important issues affecting their constituents and get a response from a government minister. Unlike Prime Minister's Questions, these debates are more in-depth and collaborative. The MP who secured the debate speaks first, other MPs can contribute, and a minister responds with the government's position.