Carers were asked to repay £33 million in 2025-26 as a result of 32,559 overpayments by the Department for Work and Pensions (DWP), new figures reveal, despite reforms introduced over a year ago to address the carer's allowance scandal.
Overpayment crisis persists
The large number of overpayments indicates tens of thousands of carers continue to suffer under the government's "business as usual" policy of maintaining penalties while gradually introducing reform. The DWP brought in measures to tackle the scandal, yet overpayment levels remain high, with some carers hit with demands for sums exceeding £20,000.
Campaigners said it was unacceptable that overpayment levels were so high and warned that carers faced continued jeopardy under a fundamentally outdated system. Labour MP Anna Dixon, chair of the all-party parliamentary group on carers, said it was shocking unpaid carers were still being hit with large overpayment debts and left to shoulder the consequences of official failures.
MP calls for transparency
"I hope the DWP will investigate why the numbers remain so high and be transparent with carers and parliament about the scale of this problem and what it intends to do to put it right," said Dixon.
Ministers vowed nearly two years ago, after an award-winning Guardian investigation, to correct longstanding benefit flaws that led to hundreds of thousands of carers unfairly acquiring huge debts and criminal records. These included draconian "cliff edge" penalties and unlawful internal guidance that prevented carers from averaging irregular earnings.
Systemic issues identified
An independent review of carer's allowance overpayments published in December found "systemic issues" and poor leadership by the DWP, rather than carer negligence or fraud, were at the root of the scandal. The DWP has since promised to reassess and reimburse tens of thousands of overpayments issued due to the unlawful averaging policy, but has yet to explain how it will compensate carers punished even after following earnings reporting rules.
The latest overpayment figures, acquired under freedom of information, show the DWP reduced both the total number and cash value of overpayments by about 30% in 2025-26. However, the number of carers accruing extreme debts of more than £20,000 rose year on year from 46 to 78, suggesting these overpayments had only been recently identified after going undetected for nearly five years.
Continued jeopardy for carers
The data also showed more than half of all overpayments were for more than £500, suggesting about 16,000 overpayments went unchecked for at least six weeks. Approximately 1,166 carers accrued over £5,000 in overpayments, potentially opening them up to fraud investigations. Ministers ordered the DWP to investigate 100% of all alerts from April 2025, but progress appears slow.
Emily Holzhausen, director of policy at Carers UK, said: "We need to see a clear explanation from the government as to why recoverable amounts for some individuals are so high after it made a promise to investigate 100% of VEPs. It is unacceptable this level of debt is being allowed to mount up."
Dominic King-Carter, director of policy at Carers Trust, added: "The data bring continued uncertainty to carers who fear they will be caught up in the system. We can now see this is an even bigger challenge than we previously thought."
DWP response
A DWP spokesperson said: "We understand the huge difference unpaid carers make and are determined to provide them with the support they need and deserve. That's why we've taken action to fix the broken carer's allowance system we inherited, including identifying and stopping overpayments more quickly through VEPs, delivering the biggest ever cash increase in the earning threshold, uprating the benefit, and accepting the vast majority of the Sayce review's recommendations."
