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Carer’s Credit

Volume 461: debated on Monday 4 June 2007

In 2010, we estimate there will be around 240,000 more people who could qualify for the state second pension through carer’s credit. Of those, around 160,000 could also qualify for carer’s credit for their basic state pension, and we will work with carers’ representatives to encourage all those who are eligible to apply to do so.

I am grateful to my hon. Friend for that reply, but given the invaluable contribution that carers make to our society and the billions of pounds that they save the taxpayer, could we not do more? Will my hon. Friend consider taking specific steps to ease the financial burden on carers, specifically to ensure that carer’s credit and carer’s allowance are equivalent to the national minimum wage and that carer’s allowance can be claimed in conjunction with the state retirement pension?

Obviously, I can agree with my hon. Friend about the valuable work that carers do and the energy and commitment that they give to their task. He raises two issues that are complex, especially the payment of carer’s allowance and the state pension. As he is aware, there is an overlapping benefit rule that makes it impossible to pay two income maintenance benefits to one individual at the same time. However, I hope he also recognises that we lifted the age barrier on entitlement to carer’s allowance so that people could carry forward their entitlement to the allowance past the state pension age. Even if such people could not claim carer’s allowance itself, they were thus entitled to claim the carer’s premium within pension credit.

We are examining ways in which we can enhance the income of carers, not just in retirement but throughout their lives, which is why, for example, carers can earn up to £87 a week as well as receiving carer’s allowance. I agree with my hon. Friend that we need to examine constantly how we can improve the situation for carers, which is why we are undertaking a review of the national carers strategy.

Given that, according to Carers UK, we will need an additional 3.5 million carers in the next 30 years but that more than half of current carers say that financial worries are affecting their health, does the Minister agree that the complexity of the benefits system does carers no favours? Does she have any plans to review the complexity of the system to ensure that we encourage and support people in their caring roles, rather than frustrating them to the extent that they pass on their responsibilities to the state?

As I am sure the hon. Gentleman is aware, we have taken steps to simplify elements of the application for carer’s allowance. We are constantly looking at how we can improve the application process. We work closely with Carers UK and other carers organisations to examine the wider issues for carers—not just the benefit issue, important though that is. I have pulled together several carers stakeholder groups to examine some of the wider strategic issues. I hope to update the House as appropriate when we have further discussions with that group.

May I push my hon. Friend a little bit further on people with old-age pensions being able to claim carer’s benefit?

Well, I appreciate that my hon. Friend, in the nicest possible way, wants to push me a little further on this particular issue. There is a complication with two benefits that are essentially for income maintenance being paid to the same person for the same purpose at the same time. We have lifted the state pension age barrier, which, to be frank, was in place for all the years of the previous Government. We lifted that to allow carers to claim the extra entitlement through pension credit that gives them an extra £27.15 a week, to recognise the caring element of their work. The problem is difficult to explain and to understand, but it arises from the overlapping benefits rule. The rules, which have been agreed by this House, across the House, on more than one occasion, state that two benefits cannot be paid to the same individual for the same purpose at the same time.

Does my hon. Friend agree, however, that financial pressure is one of the biggest worries that carers suffer? As my hon. Friend the Member for Hartlepool (Mr. Wright) rightly asked, should we not ensure a minimum standard by introducing a minimum wage for carers?

The carer’s allowance was introduced by a Labour Government in the 1970s as a recognition of carers’ commitment to their caring responsibilities. It was never intended to be a carer’s wage, and that has rarely been challenged in this House. We want to look at the wider issues relating to support for carers and, as the hon. Member for South-West Surrey (Mr. Hunt) allowed me to point out, we are working with carers organisations to look across the issues, not just at the benefits system. I reiterate that even carers who receive the full carer’s allowance may earn up to £87 a week, after deductions, to ensure that they enhance their income. We are working closely with carers organisations to examine the wider strategic issues relating to carers.