04 November 2019
The Secretary of State for Work and Pensions has today laid a Written Ministerial Statement in the House of Commons on changes to social security benefit and pension rates for 2020/21. These will come into force in April 2020.
Carer’s Allowance will rise by 1.7% to £67.25 a week, an increase of £1.10 from the current rate of £66.15 a week.
Commenting on the new rates, Emily Holzhausen OBE, Director of Policy and Public Affairs at Carers UK, said:
“Carer’s Allowance will rise with inflation to £67.25 per week, but a £1.10 increase won’t do much for carers who are struggling to pay the bills and put food on the table.
“Carer’s Allowance is the lowest benefit of its kind and Carers UK is calling on the next government to significantly increase the benefit and associated premia to make it fairer for carers across the UK.
“The earnings limit must also be increased so that carers can earn more alongside caring if they want to.
“The 3.9% increase to State Pensions will go some way to helping older carers who are not eligible for Carer’s Allowance. However in the longer term it would be better if all carers were auto-enrolled into a second pension – a Carer’s Pension – which recognises the value of their unpaid work and reduces the likelihood of financial hardship later in life.”
The way Carer’s Allowance is constructed means some unpaid carers are unaware that earning even £1 over the earnings threshold can result in 100% loss of benefit. It is the harshest withdrawal rate in the benefits system.
Through its Fairer for Carers campaign, Carers UK has long been calling for a solution to the sharp cliff edge of the earnings threshold. We want a solution that works for carers, not the current system that places a big additional administrative burden on them, as well as the DWP. Tracking earnings can be very complicated for some, particularly those who are self-employed or who have irregular shift patterns. The administrative burden of tracking earnings needs to be made simpler for everyone.
Carers UK also wants to see a rise in the earnings threshold of Carer’s Allowance to align it with the National Living Wage at 16 hours per week, making it easier for carers earn money and stay within the limits. It also gives them eligibility to other important benefits like tax credits, helping to ensure that carers don’t suffer financial hardship as a result of caring.