Martin Lewis says the working threshold for Carer's Allowance will be rising in tomorrow's Labour Budget.
The Money Saving Expert (MSE) founder shared today that he had received confirmation from the government that the working threshold for the benefit would be rising "by £30".
Currently, you can only claim the Department for Work and Pension's (DWP) carers benefit if you earn less than £151 a week after tax, National Insurance, pension contributions, and allowable expenses. If you earn over this threshold, you lose your entire entitlement to the benefit and have to pay it back - even if it's only £1.
However, Martin says the government will announce that this limit will rise to "at least £181" in tomorrow's Budget, with the new rate being introduced in April 2025. This means carers can earn more money from work and still claim the benefit. The move will impact around 1.4 million people who claim the benefit.
In his post, he said: "Good news. The Carers Allowance earnings threshold will be increased from £151 to at least £181 in the #Budget tomorrow, starting April 2025. So carers can earn more and still receive the allowance. PS I've written at least £181 as it's currently £151 and the confirmation is it'll rise "over £30 extra a week" - we think as its based on min wage hours it'll be £183, but that isn't confirmed."
Although Martin says this is "confirmed," the DWP has not issued any statement regarding the update. The MSE founder also noted that he was "still waiting to hear" about whether the Carer's Allowance benefit - which currently pays £81.90 a week - would increase and whether they would replace the "cliff edge" with a taper. This means you would not lose the entire benefit when you earn over the working limit.
Martin Lewis is one of many charities and campaigners who have called out the benefit's cliff-edge nature. The MSE founder has previously said the benefit was "perverse" as most benefits, including Universal Credit, had a taper, so if you went over the threshold, the payments are gradually reduced, while "Carer's Allowance only has a cliff-edge, leaving many to plummet off."
Many have said the rules mean claimants who work fluctuating hours could potentially fall foul of the rule without realising it. Those who fall foul often need to pay what they have received back to the DWP, with some also facing prosecution for benefit fraud. Earlier this year, the Guardian brought the issue to light, and many carers came forward to share their experiences of the system. As of May 14 2024, DWP was working to recover money from 134,800 people who had been overpaid their Carer's Allowance. The Mirror has approached the DWP for comment.