Zarah ChoudharyThe Autumn Budget announcement yesterday (30th October) introduced one of the biggest increases in the Carer’s Allowance earnings limit since the benefit was first created in 1976.
The National Living Wage will go up from £11.44 to £12.21 an hour from April 2025, while the earnings limit on the Carer’s Allowance, the main carers’ benefit, was lifted to the equivalent of 16 hours at the National Living Wage.
Working carers will now be able to earn £196 per week and claim Carer’s Allowance – an increase of around £45 per week in comparison to the previous earnings threshold of £151.
60,000 more carers will be able to access Carer’s Allowance as a result.
According to Carer’s UK, this change will help thousands of carers remain in the labour market.
Carers will be able to earn up to £2,340 per year more.
The support via Carer’s Allowance remains the lowest benefit of its kind at just £81.90 per week, and Carers UK reported that there are 1.2 million carers living in poverty across the UK who need urgent help.
Carers UK urged the Government to take urgent steps, including a full review of Carer’s Allowance and other social security benefits available to carers, to tackle the root causes of poverty.
The organisation welcomed the fact that the Government announced measures to support local authorities with at least £600m of new grant funding for social care.
However, according to Carer’s UK, the Government must also look for a long-term solution for funding.
The Household Support Fund will now be extended for 2025-26; unpaid carers are mentioned in the Household Support Fund guidance as one of the groups able to access assistance.
According to Carers UK, this is particularly important since the Government is directing those most in need of funding support and who do not get Pension Credit to the Household Support Fund.
The Pension Credit Standard Minimum Guarantee will increase by 4.1% from April 2025.
This will mean that more of the poorest pensioners will become eligible to receive Pension Credit and therefore the Winter Fuel Payment.
Unfortunately, there were no mitigations for unpaid carers due to lose Winter Fuel Payments.
Carers UK pointed out that the Government’s impact assessment released on 13th September did not consider the additional costs of carers in heating their homes.
It also did not include statistics on the number of older carers who will be impacted by the removal of the Winter Fuel Payment.
Helen Walker, chief executive at Carers UK, said: “This is a vital poverty prevention measure helping many carers, particularly women, stay in the labour market.
“It will make a noticeable difference for many, and for the first time in decades, carers will not lose out as the National Living Wage rises.
“It will help to put much needed cash into the pockets of working carers who do so much to look after their disabled, ill and older relatives.
“Many carers are still struggling with their finances whilst providing so much for society. In addition to today’s announcement, we need to see a full review of Carer’s Allowance as the lowest benefit of its kind at only £81.90 per week for providing a minimum of 35 hours of care.
“45% of carers receiving Carer’s Allowance are struggling to make ends meet and urgent steps must be taken to further tackle poverty for carers and their families.”
