The Department for Work and Pensions (DWP) has begun a major audit of over 200,000 historical carer's allowance cases, with an estimated 25,000 carers who received unlawful overpayments since 2015 likely to have their debts cancelled or reduced. The two-year, £75m reassessment exercise was announced on Monday as part of the government's effort to address systemic injustices that have drawn comparisons to the Post Office scandal.
However, ministers have admitted that existing overpayment recovery policies will continue while the full overhaul is completed, meaning thousands of unpaid carers will still face repayment demands. This includes about 22,500 claimants issued with overpayments in the three months after an independent review was published, and a stockpile of overpayments rushed out to 1,400 carers in January 2025 despite officials knowing the decisions were based on unlawful guidance discontinued in September.
The reassessment follows a Guardian investigation that revealed warnings about unfair debts and fraud convictions were ignored for years. Liz Sayce, author of the independent review, welcomed the move but expressed frustration at resistance within the DWP. Welfare Secretary Pat McFadden said the government is determined to put right a system that left carers building up debt through no fault of their own.
Carers UK chief executive Helen Walker praised the decisive action, while Carers Trust chief executive Kirsty McHugh said it was heartening to see the government acknowledging its mistakes and returning money to penalised carers.
