Vocal critic of carer’s allowance scandal to oversee the benefit as minister

The Labour MP Stephen Timms, a vocal critic of the carer’s allowance scandal that has led to thousands of unpaid carers being plunged into debt and threatened with prosecution, has been given ministerial responsibility for the issue.

Widespread public outrage followed Guardian revelations earlier this year that tens of thousands of carers had been forced to repay huge sums after inadvertently breaching the carer’s allowance earnings rules, often by just a few pounds, prompting comparisons with the Post Office scandal .

Timms was until June the chair of the cross-party Commons work and pensions select committee, from where he led parliamentary calls to fix flaws in the carer’s allowance system that had left unsuspecting carers with debts as high as £20,000.

In May he called on ministers to “move without delay to get a grip of the problem and ensure carers are no longer subjected to the distress that such overpayments can cause”, and persuaded the National Audit Office to reinvestigate carer’s allowance overpayments, five years after it first highlighted problems with the benefit.

He was also instrumental in forcing the Department for Work and Pensions (DWP) to publish an internal study of the financial and emotional impact of overpayments on carers, which had been kept secret by ministers for three years. The study revealed affected carers had endured high levels of hardship and distress as a result.

Timms has been appointed DWP minister for social security and disabilities. He will have oversight of carer’s allowance, meaning he will play a key role in any decisions to review the DWP’s handling of the benefit, which is now claimed by about 1 million unpaid carers .

During the general election campaign Labour suggested it would review carer’s allowance, despite not formally committing to do so in its manifesto. The work and pensions secretary, Liz Kendall, said last month a Labour government would “need to put the system right for the long term”.

Overpayments occur when someone who claims the £81.90 a week allowance, often while looking after a frail, disabled or ill relative, breaches a draconian “cliff edge” earnings cap that limits their income to £151 a week in a paid job.

If the carer earns over that limit, even by a penny, their entire weekly allowance is deemed to be an overpayment, which the DWP forces them to repay. A carer who earned £1 more than the £151 threshold for 52 weeks, therefore, would have run up £52 in total overpayments – but would typically have to pay back £4,258.80.

Many carers have said they were unaware they had gone over the earnings limit, and auditors said the vast majority of cases were not fraud but “honest mistakes”. The DWP has been criticised for failing to inform claimants of earnings limit violations, even though it receives an electronic alert each time a potential breach occurs.

Although the DWP has previously said major reforms to carer’s allowance would be complex and costly, campaigners argue it would be hard for new ministers to ignore the issue, given the scale of the problem, and the widespread perception of injustices being meted out.

Of the three main parties, only the Liberal Democrats, whose leader, Ed Davey, is himself a carer, made concrete manifesto commitments to overhaul carer’s allowance. The Lib Dems have since called for cross-party talks on social care and said the party was determined to ensure unpaid carers “ cannot be forgotten again by people in power”.

Helen Walker, the chief executive of Carers UK, said: “We are delighted that Sir Stephen Timms MP has been appointed as the DWP minister for social security and disabilities.

“Through his role as chair of the work and pensions select committee he has developed a good understanding of the key issues relating to carer’s allowance and the devastating impact of overpayments on unpaid carers. We therefore very much look forward to working with him to make life better for carers.

“Carers UK has long campaigned for a reform of the benefits system to end poverty amongst unpaid carers – most recently calling for urgent change to stop thousands of carers being unfairly pursued for carer’s allowance overpayments.”