Both the Government and I recognise and appreciate the vital role played by unpaid carers, and I understand that this is an extremely important issue for many carers.

The primary purpose of Carer's Allowance is to provide a measure of financial support for people who give up the opportunity of full-time employment in order to care for a severely disabled person. It must be stressed that it is not a carer’s wage or payment for the services of caring, nor is it intended to replace lost or forgone earnings in their entirety.

The Carer's Allowance earnings limit is not linked to the number of hours worked. Instead, it is set at a level that aims to encourage people to maintain a link with the labour market through part-time work. The earnings limit for Carer's Allowance is a net figure, meaning it takes into account Income Tax, National Insurance contributions, and half of any contributions to an occupational or personal pension, and there are also a number of other deductions which can be made. That means that people can earn significantly more than £139 per week gross and still be eligible for Carer's Allowance.

In April 2023, Carer's Allowance was increased by 10.1 per cent, in line with inflation, from £69.70 to £76.75 per week. Indeed, in April 2024, all working-age benefits, including Carer's Allowance, will be uprated in line with September 2023 Consumer Price Index Inflation – 6.7 per cent.

I would encourage carers to check their eligibility for additional support, such as Universal Credit. Universal Credit can include an additional amount for carers who provide care of 35 hours or more each week for a severely disabled person. For carers who satisfy the qualifying criteria, an additional amount of £185.86 per month is included in their Universal Credit entitlement. For those receiving Universal Credit, the 55 per cent taper rate and any applicable work allowance will help to ensure that people are better off in work.

Individuals on Carer's Allowance and Legacy Benefits

I would emphasise that claimants on legacy benefits can make a claim for UC if they believe that they will be better off. However, claimants should check their eligibility before applying to UC as legacy benefits will end when a claim to UC is submitted. I must stress that claimants will not be able to return to legacy benefits in the future.

Carer's Allowance and the National Living Wage 

I note your concern over the relationship between the Carer’s allowance and the National Minimum Wage. As mentioned, the earnings limit for Carer’s Allowance is not linked to any particular factor such as the number of hours worked, or the National Living Wage. However, the Government keeps the earnings limit under review and will consider changes where they are warranted and affordable.