Unpaid carers between the ages of 16 and 25 are in around £9.4m of debt due to “unforgiving” benefit rules, The i Paper can reveal.
Some 12,705 young people face an average debt of £739.87 each from being overpaid carer’s allowance, a new Freedom of Information request shows, although some must repay much higher sums.
One person owes £18,869 to the Department for Work and Pensions (DWP), the highest overpayment held by a young person claiming the benefit.
Helen Walker, chief executive of Carers UK, said these debts will add to “the emotional pressures of caring and significant responsibilities these young people already carry”.
“This has the potential to affect education and future opportunities by making it harder to focus on studies, training or employment,” she added.
Carers ‘let down’ by systemic issues
Carer’s allowance is a benefit paid to those who spend at least 35 hours a week caring for a person receiving a qualifying disability benefit. It is currently worth £86.45 a week and can be claimed by any carer aged 16 or older.
However, claimants lose eligibility if they take a break from caring or exceed the earnings limit, which is currently £204 per week.
Most benefits have an earnings taper, which means that payments are gradually reduced as income rises. But carer’s allowance has a “cliff edge”, which sees claimants losing the whole £86.45 if they exceed the earnings limit by a single pound. Claimants also become ineligible if they study for 21 hours or more per week.
These rules can leave carers vulnerable to accidental overpayments, which they are forced to repay. For example, a young adult carer who starts university or takes on more paid work might not realise that they need to report this change to DWP.
This can result in the carer continuing to receive the allowance until they are told they need to repay it – by which point, the money may have been spent, as they didn’t realise it wasn’t rightfully theirs, and they could struggle to repay it without going into debt.
Last year, an independent review conducted by Liz Sayce concluded that “systemic” issues within the DWP led to carers unwillingly building up debt. Overpayments were blamed on “the complexity of the rules”, “unclear advice” issued by DWP and the “unforgiving” nature of the cliff edge.
Many carers, including those who have spoken to The i Paper, have said they were treated “like criminals” and penalised for working.
Following the review, DWP admitted that carers were “let down” and agreed to reassess 230,900 overpayments cases. However, five months into this process, it has examined only 1.04 per cent of the cases it needs to reassess over the next three years.
Alison Bennett MP, chair of the All-Party Parliamentary Group for Young Carers and Young Adult Carers, has criticised the DWP for reassessing cases “at a snail’s pace”, saying this “makes a mockery of the Government trying to put right its past failings”.
“The priority must be to put an end to the suffering and anxiety that the scandal has caused so many family carers across the country,” she said.
The DWP says it is on track to complete the reassessment exercise within three years and that it is doing more to identify and stop overpayments.
‘Pushed to a breaking point’
Supporting young people to get into work has been set out as a priority for this Government. Almost one million young people are not in education, employment or training (Neets).
Young adult carers face additional barriers, with research from Carers Trust revealing that almost half have missed out on education or training due to their caring responsibilities. When it comes to employment, 38 per cent said they had to turn down or not apply for a job due to their caring role.
Ramzi Suleiman, policy manager at Carers Trust, said the rules surrounding carers allowance are “completely counter-intuitive to the Government’s ambition of reducing the number of Neet young people in the UK”.
He said that the limitation on studying “forces thousands to make an impossible choice between learning and caring” and keeps many young carers in a cycle of poverty.
Bennett added: “It is not fair that so many young adult carers are pushed to breaking point whilst trying to juggle the responsibilities of caring for someone they love, getting an education and earning enough to support themselves.
“The earnings limit for carers allowance makes a difficult situation even worse when unexpected debts can accrue simply for a taking on an extra shift, and for those studying for qualifications, the 21-hour rule can penalise someone for trying to better themselves.
“Quite simply, young adult carers deserve a system that recognises their responsibilities, supports their independence and does not undermine their future opportunities.”
Walker said it was “very concerning” that so many young adult carers were “starting their adult lives in debt”.
“It is vital that we investigate the underlying reasons for these overpayments and whether changes to rules or guidance are needed to prevent them from happening in the first place,” she said.
This should include a change to the 21-hour rule, which was relaxed in Scotland in 2023.
He added: “It feels deeply unfair if young adult carers did not understand these rules or realise they had been overpaid.
“While we don’t know how many of these cases will fall within the scope of the Government’s carer’s allowance overpayments reassessment exercise, these figures further highlight the urgent need to accelerate progress in this area.”
A spokesperson for the DWP said: “We understand the huge difference unpaid carers make and are determined to provide them with the support they need and deserve.
“That’s why we’ve already taken action to address overpayments by launching the reassessment exercise in April, launching our call for evidence to modernise the benefit, and identifying earnings linked overpayments more quickly.
“[The] DWP remains committed to working with anyone who is struggling with their repayment terms and will always look to negotiate sustainable and affordable repayment plans.”