The UK Government is changing the Carer’s Allowance earnings rule from Wednesday, ending a system that could see carers lose their entire payment after earning just a few pence above the weekly limit.
The Carer’s Allowance Cliff Edge Is Ending
Under the current rules, carers can lose their full weekly allowance if their earnings exceed the £204 limit by even a small amount.
The system has been criticised by carers and support groups because a small pay rise or an extra shift could leave someone financially worse off.
Chancellor John Healey said the current system had worked against carers who wanted to work more.
Payments Will Be Reduced Gradually
The new system will replace the cliff edge with a gradual taper. This means Carer’s Allowance will reduce as earnings rise rather than disappearing immediately after the income limit is exceeded.
The change is intended to give carers more flexibility to take on additional hours or accept a modest pay rise without suddenly losing their entire benefit.
Government Responds To Carers’ Concerns
Work and Pensions Secretary Pat McFadden said the government had listened to concerns from carers who could become financially worse off after working additional hours.
The change is aimed at removing the sharp cutoff that currently applies when earnings pass the limit.
Carers’ Groups Welcome The Change
Carers Trust described the reform as an important change but called for a wider review of Carer’s Allowance, reports Birminghammail.
Carers UK also welcomed the move, saying a tapered system should give families more choice when combining paid work with caring responsibilities.
The organisations have urged the government to use the reform as a starting point for further changes to the benefit.
What Carers Need To Know
The new system is due to take effect from Wednesday, October 28. The main change is that earning slightly above the current limit should no longer result in the immediate loss of the entire allowance.
Further details of how the taper will operate will determine exactly how payments change as a carer’s earnings increase.
