MPs threaten fresh inquiry into carers allowance scandal amid redress delays | Carer’s allowance
MPs have threatened to launch a new inquiry into the carers’ allowance scandal after unpaid carers spoke of being “left in limbo” due to the government’s response.
The warning comes amid concerns about delays to the Department for Work and Pensions’ (DWP) plans to offer compensation to tens of thousands of carers who were unfairly overpaid based on discredited official guidance.
Debbie Abrahams, chair of the House of Commons work and pensions select committee, said MPs were actively considering launching a new inquiry into what she called a “flood of missteps” in the DWP’s response to the scandal.
One harsh letter Speaking to social security minister Stephen Timms, Abrahams raised issues with the DWP management culture and questioned whether senior officials shared ministers’ commitment to tackling carer’s benefit injustices.
He said the DWP’s failure to deal with the matter “with due care” would “lead many to conclude that” [it] “The public commitment to doing this is not serious, which is extremely damaging to existing trust issues in the department.”
Last week the Guardian revealed that hundreds of unpaid carers continue to face backpay bills despite DWP officials knowing overpayments were based on illegal internal guidance on average earnings.
An unpaid carer told the Guardian that he was informed by the DWP in March 2025 that there had been numerous overpayments since 2020 relating to monthly breaches of benefit earnings rules, even though their average annual earnings were within permissible limits. At this point they have not received a payment request.
In September 2025, the DWP quietly changed its guidance on average earnings, and in November, following a formal review by disability expert Liz Sayce, the government formally admitted its earnings average rules were flawed and incompatible with social security law.
Despite this admission, in December the DWP claimed the carer for back pay of more than £6,000 calculated under the old guidance. This included a £50 fine for alleged non-compliance with welfare rules. They are appealing the decision.
“It hurt me so much; I couldn’t sleep, I didn’t want to eat, it was worse than I’ve ever felt in my life,” said the caregiver, who wished to remain anonymous. “Even if the government has accepted the findings of the review, I do not understand why the DWP is still allowed to act in this way.”
Ramzi Suleiman, policy manager at the Carers Trust, said the DWP’s reliance on outdated guidance was worrying. “It is difficult to find any justification why the new guidance should not be used to assess these alleged overpayments,” he said.
The DWP’s years-long failure to deal with carer’s pay issues has left hundreds of thousands of carers unfairly plunged into debt, an award-winning Guardian investigation has revealed. As a result, many caregivers suffered health problems and hundreds were convicted of welfare fraud.
Although ministers have vowed to fix what they see as a terrible legacy from their Tory predecessors, there are growing concerns about the pace of change. The DWP had initially promised details of the reassessment exercise in the new year. Now he says the exercise is still weeks away from starting.
Senior DWP officials have come under repeated criticism in recent weeks over carer’s allowance failures. Sayce criticized “resistance forces” within the ministry, while Abrahams accused his permanent secretary, Sir Peter Schofield, of presiding over a “culture of indifference”.
Meanwhile, carers told the Guardian they were left “in limbo” as they waited months to challenge overpayment decisions before a judge at a social security tribunal.
“We saw a glimmer of hope when the Sayce review revealed many of the DWP’s shortcomings,” said Guy Shahar, 53, whose family was fined £10,000, averaging £1.92 over five years, for mistakenly exceeding earnings rules.
The family appealed to the court against the “inhumane” sentence given to them and received an adjournment in November due to the possibility that the guidelines might change as a result of the Sayce review.
But four months later, Shahar said he had lost hope and feared they would be plunged into a “devastating” financial crisis. “We came back feeling like our whole lives were in limbo again, with all the stress and anxiety of a completely unfair £10,000 fine hanging over our heads,” he said.
Helen Walker, chief executive of Carers UK, said: “Carers need to see clear and proactive communication about the timeline of the reassessment process. We have heard from carers who say they are living with significant uncertainty.”
A DWP spokesman said: “We have accepted the vast majority of recommendations from the Sayce review and have already made changes – hiring additional staff, updating internal guidance and making letters clearer.”
