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80,000 face fines for Carer Allowance overpayments

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Written by: Danielle Levy
26/04/2019
The Department for Work and Pensions (DWP) is hoping to recover £150m from individuals who have received overpayments of the Carer’s Allowance.

The National Audit Office (NAO) said the project is likely to result in repayments from close to 80,000 carers who have been deemed at fault for the overpayment.

The Carer’s Allowance is paid out to those who care for people who qualify for disability benefit. In order to claim the allowance, they must look after the individual for at least 30 hours per week.

In some cases, DWP is hoping to recover more than £20,000 from carers who have been overpaid. In total, the department is aiming to collect around £150m.

In the 2018-19 financial year, DWP detected 93,000 overpayments. This compares to an average of 41,000 a year over the previous five years. While many overpayments were for one week, some cases went on for more than a decade before they were discovered.

However, the NAO pointed out that the DWP has failed to consider the impact that these repayments will have on carers, who are often from vulnerable families. At the standard rate of repayment for those on benefits, they suggest that it will take an average of three and a quarter years for carers to repay their debt.

For those who are on benefits with an overpayment of £20,000, this could require repayments for the next 34 years.

The NAO also noted that the DWP has reclaimed £22m of overpaid Carer’s Allowance in 2018-19 by reducing people’s benefits and through mandatory deductions from employee earnings.

Most detected overpayments have arisen because carers failed, as soon as ‘reasonably practicable’, to notify the DWP with correct information about their earnings. It classifies 89% of the value of overpayments as fraud or claimant error, which are the claimant’s fault and must therefore be repaid.

While many overpayments were for one week, in some cases they went on for more than a decade before they were discovered.

The human cost

Frank Field MP, chair of the parliamentary work and pensions committee, commented: “Once again, the NAO has devastatingly laid bare the incompetence at DWP, and its stark human cost. Not for the first time, we see DWP squeezing those least able to afford it.

“It will chase down carers who provide such an immense service to our society, potentially cutting their income for decades – when it knows that a large part of the responsibility lies squarely at its own door. Worse still, the NAO shows that DWP hasn’t bothered to find out what clawing back these sums will cost carers and the people they care for, in every sense.”

In light of this, he concluded: “There was already plenty wrong with the way we recognise carers’ invaluable contribution. Rather than making things worse, why doesn’t the Department just spare us all: end this massive scandal, focus on the real fraudsters and write off the overpayments it has allowed to build up unchecked.”

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