MPs threaten fresh inquiry into carers allowance scandal amid redress delays

MPs have threatened to launch a fresh inquiry into the handling of the carers allowance scandal after unpaid carers spoke of being “stuck in limbo” by the government’s response.The warning came amid concerns over delays in Department for Work and Pensions (DWP) plans to offer redress to tens of thousands of carers who were unfairly issued with overpayment bills based on discredited official guidance.Debbie Abrahams, the chair of the Commons work and pensions select committee, said MPs were actively considering opening a fresh investigation over what she called a “torrent of missteps” by the DWP in its response to the scandal.In a scathing letter to the social security minister Stephen Timms Abrahams raised issues over the culture of DWP management and questioned whether senior officials shared ministers’ commitment to address carer benefit injustices.She said the DWP’s failure to tackle the issue “with due care” would cause many to “conclude that [it] is not serious in its public commitment to do so, which is extremely damaging to the existing issues of trust with the department”.Last week the Guardian revealed that hundreds of unpaid carers continued to be hit with repayment bills even after DWP officials knew the overpayments were based on unlawful internal guidance on averaging earnings.One unpaid carer has told the Guardian they were notified by the DWP in March 2025 of several overpayments since 2020 relating to monthly breaches of benefit earnings rules, even though her annual average earnings were within allowed limits. At this point they did not receive a payment demand.In September 2025, the DWP quietly changed its guidance on averaging earnings – and in November, in the wake of an official review by disability expert Liz Sayce, the government formally accepted its earnings averaging rules were faulty and incompatible with social security law.Despite this admission, in December the DWP issued the carer with a demand to repay more than £6,000, calculated using the old guidance. This included a £50 civil penalty issued for supposedly failing to follow benefit rules. They are appealing against the decision.“It did get me very wound up – I couldn’t sleep, I didn’t feel like eating, it was worse than I have ever felt in my life,” said the carer, who wished to remain anonymous. “I don’t understand why, if the government had accepted the findings of the review, the DWP was still allowed to behave in this manner.”Ramzi Suleiman, policy manager at Carers Trust, said the DWPs reliance on old guidance was alarming. “It’s difficult to find any justifiable reasons why the new guidance was not used to assess these alleged overpayments,” he said.The DWP’s failure for years to tackle problems with carer’s allowance that led to hundreds of thousands of carers being unfairly plunged into debt, were revealed in an award-winning Guardian investigation. Many carers endured ill-health as a result, and hundreds were convicted of benefit fraud.Although ministers pledged to fix the system they consider to be a dire inheritance from their Tory predecessors, there are growing concerns over the pace of change. The DWP originally promised details of the reassessment exercise in the new year. It now says the launch of the exercise is still weeks away.Senior DWP officials have come under repeated criticism over carer’s allowance failures in recent weeks. Sayce criticised “forces of resistance” within the department, while Abrahams accused its permanent secretary Sir Peter Schofield of presiding over a “culture of complacency.”In the meantime, carers have told the Guardian they are “stuck in limbo” as they wait months to challenge their overpayment decisions in front of a judge at a social security tribunal.Guy Shahar, left, says he has lost hope with a ‘totally unfair’ £10,000 hanging over his head. Photograph: Linda Nylind/The Guardian“We got a glimpse of hope when the Sayce review exposed many of the DWP’s shortcomings,” said Guy Shahar, 53, whose family was hit with a £10,000 fine for accidentally overstepping earnings rules by an average of £1.92 over five years.The family appealed against their “inhumane” fine to a tribunal and were granted a postponement in November because of the prospect the guidance would be changed as a result of the Sayce review.However, four months later, Shahar said he had lost hope and feared they would be pushed into a “devastating” financial crisis. “We’re back with that feeling of our whole lives being in limbo again, with all the stress and anxiety of a totally unfair £10,000 fine hanging over our heads,” he said.Helen Walker, the chief executive at Carers UK, said: “Carers need to see clear, proactive communication about the timeline for the reassessment process. We have heard from carers who say that they are living with significant uncertainty.”A DWP spokesperson said: “We’ve accepted the vast majority of the Sayce review’s recommendations and have already made changes – hiring extra staff, updating internal guidance, and making letters clearer.”