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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

Shipley
Opened the debate
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.

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.