Carers: Pensions

(asked on 6th March 2015) - View Source

Question to the Department of Health and Social Care:

To ask the Secretary of State for Health, what assessment he has made of the effect on the affordability of care of the requirement for people with carers to pay pension contributions for those carers.


Answered by
Norman Lamb Portrait
Norman Lamb
This question was answered on 16th March 2015

Direct Payments are defined as payments in lieu of a service that would normally be provided, so if someone needs care and employs a care worker or personal assistant to do so, the direct payment should cover all the costs involved, including any mandatory pension payments.

The Care Act statutory guidance sets out clearly that when an individual chooses to employ staff, they should be made aware of their legal responsibilities as an employer, which includes issues such as the statutory pension rights of the employee.

Automatic enrolment into workplace pensions is being rolled out to small and micro employers over the next three years. It places a statutory duty on employers to automatically enrol eligible workers into a workplace pension and make at least a minimum contribution. Eligible workers are those who are aged at least 22 and under state pension age and have earnings over £10,000 per year (£192 per week). Workers earning over £5,772 per year (£112 per week) have the right to opt in to a workplace pension and receive an employer contribution.

Minimum employer contributions are currently 1% on a band of earnings between £5,772 and £41,865. An individual earning £193 per week would need to be automatically enrolled and the minimum employer contribution would be £0.81 per week.

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