UK (Parliament Politics Magazine) – Ministers have allocated £75 million to resolve the fallout from the carer’s allowance overpayment crisis, which affected thousands of unpaid carers between 2015 and 2025. This funding part of a government response follows the independent Sayce review and a commitment to reassess and cancel debts where applicable to support carers financially harmed by system failures.
Government funding to address carer’s allowance overpayments
As reported by the Carers Trust CEO Kirsty McHugh via Benefits and Work, the government announced a £75 million fund to cover costs related to cancelling debts or repaying previously collected overpayments linked to the Carer’s Allowance scheme. These overpayments occurred due to unclear guidance and administrative errors affecting carers over the last decade, causing substantial financial distress.
Sayce review findings and government response
The action follows the Sayce review, published in November 2025, led independently to investigate the causes and consequences of overpayments in the Carer’s Allowance system between 2015 and 2025. The review detailed how unclear rules and recent reforms contributed to widespread debt claims against carers, many of whom were often unaware of the overpayments until repayment demands. The government has accepted key recommendations including reassessing all affected overpayment cases, reducing debts, and refunding money where appropriate.
Scope of the crisis and affected carers
According to government data analyzed by Carers UK and published on GOV.UK, around 185,000 unpaid carers in England and Wales had overpayments related to eligibility rules and benefit interactions flagged from 2015 to September 2025. Many carers faced penalties despite continuing their caring roles, sometimes forced to repay money that compounded their financial hardships. The review’s scope also covered those no longer caring full-time but still impacted by arrears caused during active caregiving periods.
Policy changes and financial support details
Carer’s Allowance currently pays £83.30 per week (from April 2025), designed to support those caring for someone for at least 35 hours weekly. The government has committed to increasing eligibility thresholds and has previously raised the earnings limit from £151 to £196 per week. These adjustments aim to help more carers qualify without losing benefits prematurely. Campaigners have pushed for further increases and structural reforms to ensure carers receive sustainable support.
The £75 million fund is a partial remedy focused on correcting past mistakes, especially debts imposed unfairly on carers. Authorities are exploring longer-term solutions to prevent future overpayment issues, including clearer guidance and possibly reforming the earnings taper system relating to Carer’s Allowance and Universal Credit.
Responses from carers groups and policymakers
Carers Trust and advocacy organisations welcomed the funding announcement but stressed that it falls short of comprehensive care reform needed to address systemic social care underfunding in the UK. Kirsty McHugh emphasized the urgency of tackling the broader care crisis beyond financial fixes to create lasting security and dignity for carers.
The government remains under pressure to outline detailed plans for sustainable social care funding as part of broader welfare and healthcare reforms promised in recent Autumn Budgets. The carer’s allowance scandal highlighted significant gaps in monitoring and support mechanisms, spurring calls for more transparent and accountable administration.
