Carer’s Allowance is a state benefit you might be eligible for if you care for someone close to you. The current rate for 2024-25 is £81.90 per week.
Currently, you might be eligible for Carer’s Allowance if you spend at least 35 hours per week caring for someone who receives a qualifying disability benefit. To get the cash, you can only earn up to £151 per week after tax.
Reeves announced the weekly earnings limit for Carer’s Allowance will be increased to £181 per week. This is equivalent to 16 hours at the National Living Wage.
The move will make more than 60,000 carers eligible for support, and help carers to balance work and caring responsibilities.
The Government said the rise is the largest ever increase of the earnings limit and provides certainty for carers with a commitment that the earnings limit will increase with the National Living Wage in the future.
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The Government recently announced an independent review into overpayments of Carer’s Allowance, which will consider how they occurred and what operational changes can be made to minimise the risk of future overpayments.
Other benefit boosts
Reeves said the Government will provide £1bn to extend the Household Support Fund and Discretionary Housing Payments in 2025-26, which will be used by local authorities to address immediate hardship and crisis.
The Government is also creating a new Fair Repayment Rate, which caps debt repayments made in Universal Credit, allowing 1.2 million households to keep more of their Universal Credit cash.
Richard Lane, chief client officer at StepChange Debt Charity, said: “It’s hugely welcome that the Government is taking action to reduce unaffordable deductions from Universal Credit. StepChange has campaigned alongside sector partners on this issue in recent years and last year gave evidence to the Work and Pensions Committee highlighting the problem.
“Our recent polling shows that those on UC (35%) are almost four times more likely to be behind on at least one essential bill compared to the wider population (9%). In this context, unnecessary debt deductions inevitably cause hardship, leaving vulnerable households to go without essentials or turn to credit to cope. Over nine in 10 StepChange clients affected report deductions have caused them to go without essentials.”
Crackdown on benefits fraud
The Chancellor also announced a “crackdown on fraudsters” operating within the benefit system as part of an overhaul of the Department for Work and Pensions (DWP).
Richard Hyde, senior researcher at the Social Market Foundation, said: “Benefit fraud is estimated to have cost the taxpayer more than £7bn in the most recent fiscal year. Therefore, stronger efforts to crack down on taxpayers’ money being siphoned off by often organised fraudsters are to be welcomed.
“In such a context, the proposal for greater access to bank account information about welfare recipients is a positive move. This won’t be a silver bullet, but as part of a package of measures it is one more useful tool for fraud investigators to utilise to help them reduce the benefit fraud bill.”
