Key workers quit jobs to avoid cash penalties for breaching carer’s allowance

Teachers, NHS staff and other key workers who balance part-time work with caring for loved ones are quitting their jobs to avoid being hit with huge cash penalties for breaching carer’s allowance rules, according to a study.

Research into the human impact of the penalties found sanctions running into thousands of pounds, triggered by opaque rules, and poor administration by benefits officials playing havoc with carers’ working lives, health and finances.

The report, by Carers UK, a charity, details carers being forced to take desperate measures to avoid breaching tight earnings limits, including: quitting their jobs; cutting their hours; turning down pay rises, one-off cost of living payments and performance bonuses; and even working free hours each month.

Those who unwittingly breached the £151 a week earnings limits – in some cases by less than £1 – said the disproportionate penalties levied on them for doing so landed them with huge debts, plunging them and the people they care for into hardship, and inflicting a savage toll on their mental health.

The so-called “cliff-edge” earnings rules mean a carer who oversteps the limit must repay the whole £81.90 weekly allowance. A carer who earned £1 more than the £151 threshold for 52 weeks, therefore, would pay back not £52 but £4,258.80. Some are prosecuted for fraud.

A Guardian investigation earlier this year revealed the scale of the carer’s allowance injustices, including the last government’s failure to address failings it had known about for years . Latest figures show 134,500 unpaid carers were repaying £251m in earnings-related overpayments, with 11,500 carers repaying sums above £5,000.

The report, published on Monday, came as a delegation of unpaid carers led by Carers UK was due to meet ministers at the Department for Work and Pensions (DWP) to call for urgent reforms to the benefit.

Campaigners are optimistic they will get a more sympathetic hearing than previously. Labour promised to review carer’s allowance during the election campaign, and carers are buoyed by the appointment of Sir Stephen Timms, a vocal critic of carer’s allowance failings in opposition, as the minister with responsibility for the benefit.

The report, based on interviews with more than 120 unpaid carers, uncovered huge anger at benefits officials, whom they blamed for failing to notify them when they unwittingly breached earnings limits, and then “treating them like criminals” when they were pursued for repayments as high as £18,000.

Some said they had stopped claiming carer’s allowance – the main carers benefit worth £4,258 a year – because of the constant stress of avoiding being penalised while juggling part-time work and at least 35 hours a week of unpaid caring.

Carers UK described its findings as “devastating” and called for urgent reform of carer’s allowance, claimed by nearly a million unpaid carers. Intended as a cash support for unpaid carers – regularly praised as “unsung heroes” by politicians – it has become a byword for bureaucratic cruelty and incompetence redolent of the Post Office scandal .

Helen Walker, the chief executive of Carers UK, said: “It is heartbreaking to hear of instances where thousands of pounds of debts have been accumulated. This has been going on for years and not enough has been done by government to fundamentally change the situation. It simply cannot continue.”

In a statement issued ahead of his meeting with campaigners, Timms praised unpaid carers and said the UK would “grind to a halt” without the work they do supporting vulnerable people.

‘I felt like a criminal, as if I’d committed a crime, because I was trying to understand a system that makes no sense at all’

Elizabeth Tait

“We recognise the challenges they are facing and we are determined to provide unpaid carers with the support they deserve,” he said.

He added: “Meeting organisations like Carers UK and individual carers and hearing their views and experiences is key to helping us to establish the facts and make informed decisions.

“With respect to overpayments of carer’s allowance, we are moving quickly to understand exactly what has gone wrong so we can set out our plan to put things right.”

A common theme of the Carers UK study is how the tight earnings rules prevent carers keeping a part-time foothold in the labour market to retain skills and earn money while continuing to look after disabled and frail relatives. The government has said it wants to “get Britain working” by removing barriers to employment.

Enka Plaku, an unpaid carer for her son, who gave up work after being hit with a £6,800 overpayment, told the Guardian: “They want teachers all the time but I’m one of them forced to be at home when I can go in and work.”

The Carers UK study uncovered widespread anger among carers that although DWP officials have the technology to spot earnings breaches as soon as they happen, it has regularly failed to alert carers about them for months or years before imposing massive overpayment penalties and in some cases threatening them with prosecution.

The shock of receiving penalties – which carers said were down to oversights caused by hazy and complex earnings rules – was compounded by often callous treatment by benefits officials.

One unnamed carer said there was “a cruelty written into the [carer’s allowance] system that kind of rubs you out as a person.”

Another carer, Elizabeth Tait, who unknowingly ran up ran up a £1,623 overpayment, told the Guardian: “I felt like a criminal, as if I’d committed a crime, because I was trying to understand a system that makes no sense at all.”