Martin Lewis has issued an urgent warning to people claiming a certain government benefit that they could be forced to pay £820 back due to a “cliff edge” cutoff with how the benefit works.
The MoneySavingExpert founder has hit out against rules that apply to Carer’s Allowance, warning that slight overpayments or wage increases can result in people being left out of pocket.
You can get Carer’s Allowance if you care for someone for at least 35 hours a week and they get certain benefits. You don’t have to be related to, or live with, the person you care for to qualify and you don’t get any extra cash if you care for more than one person.
The benefit provides up to £81.90 per week, but you’re only eligible if you earn less than £151 per week.
Go over that, even by a penny, and you don’t just lose the penny, you lose the entire £81.90 benefit payments and what’s worse, the government will make you pay it all back, even if you’ve already spent it.
Martin sounded the alarm over the issue as he called for the government to change the rules following the launch of a consultation.
He tweeted: “Govt’s just put out its Carers Allowance consultation remit. Its worthy aim’s to examine how to stop the overpayment crisis that’s left 100,000+ unwittingly owing State money.
“Yet my concern is it mightn’t address the big issue ie the hideous cliff-edge!
“Carers allowance provides those on low income who care £82 a week income, but you can only get it if you earn under £151/wk. Go 1p over that limit and you lose it all. That is perverse.
“Other benefits don’t work that way – they’re tapered. And this is the clear cause of the problem (I’ve written to the Chancellor about it before).
“Overpayments happen because many carers are stressed overworked vulnerable people. If they get a slight pay uplift (eg min wage rise) and don’t notice, the benefits office keeps paying them. So they could’ve earned 1p a week over for 10 weeks, then be asked to pay an unaffordable £820 back.
“I have put a question in to the consultation body to double-check that they are able to examine this, and hope they are, if not the whole thing would feel farcical. I will keep you up to date.”
