Question to the Department for Work and Pensions:

To ask the Secretary of State for Work and Pensions, what recent assessment his Department has made of the potential impact of the Carer’s Allowance earnings limit on the labour market participation of unpaid carers.

Financial support for unpaid carers is available from the Department for Work and Pensions through Universal Credit, Pension Credit, and – in England and Wales – Carer’s Allowance, which is not means-tested.

The Government wants to encourage unpaid carers to combine their caring responsibilities with paid work where they can, although this will not always be possible due to number of hours spent caring and/or the intensity of that care.

The Government has increased the weekly Carer’s Allowance earnings limit to match 16 hours work at National Living Wage levels. This change from April 2025 resulted in the largest ever increase in the limit to £196 net earnings a week and the highest percentage increase since 2001. It means more than 60,000 additional unpaid carers who are doing some paid work will be able to receive Carer’s Allowance between 2025/26 and 2029/30. The earnings limit rose again to £204 from April 2026. Universal Credit includes a system of an earnings taper and work allowances (where applicable) to help ensure that people are better off by working.

Going forward the Government will be replacing current Carer’s Allowance earnings cliff edge rules with an earnings taper. This means that from 2030 unpaid carers will be able to earn above the earnings allowance without immediately losing all of their Carer’s Allowance. Instead, their Carer’s Allowance will be reduced £ for £ for what they earn above that allowance. Unpaid carers will be able to increase hours and earn more than they do now and still receive some Carer’s Allowance, increasing overall income. Please also see my Written Statement on 29 October 2026 (HCWS429).