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<p>This is an issue that we have looked at closely, particularly in the light of recommendations
from the Work and Pensions Select Committee in their report on employment support
for carers and support for a taper from other stakeholders.</p><p> </p><p>Carer’s
Allowance (CA) is not a means-tested benefit and its primary purpose is to provide
a measure of financial support and recognition for people who give up the opportunity
of full-time employment in order to provide regular and substantial care for a severely
disabled person.</p><p> </p><p>The purpose that the weekly earnings limit serves in
CA is very different to that of a taper – it is essentially there to provide a test
of whether the carer is in “gainful employment” and, therefore, eligible for CA. Tapers
are designed to make sure that work pays in means tested benefits, and already work
well for those carers also claiming Universal Credit.</p><p> </p><p>A cost neutral
taper would need to begin at a level lower than the current earnings limit. We are
concerned that introducing a cost neutral taper, effectively reducing the amount of
CA for some, would introduce a disincentive to work for some of those carers with
the lowest incomes, as well as significantly complicating the current CA scheme (for
example, we would need to put arrangements in place to manually collect details of
weekly earnings and adjust CA awards accordingly).</p><p> </p><p>In view of the recent
focus on overpayments of CA, it is worth noting that a cost neutral taper would mean
more carers would have to report changes of earnings more frequently, thus presenting
fresh challenges in terms of making correct payments. For these reasons, we are not
in favour of introducing a taper in CA. We will, of course, continue to keep the earnings
rules in CA under review to ensure they are meeting their objectives.</p>
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