Carer's allowance 'cliff-edge' rule to be abolished, with a digital taper system due in the budget

Summary

The controversial rule that penalised unpaid carers with losses amounting to thousands of pounds is to be abolished, according to reporting by The Guardian. Chancellor John Healey is due to announce a new digital taper system for carer's allowance in Wednesday's budget, which the Guardian says would effectively end what it describes as one of the UK benefit system's most feared and unfair administrative practices. The cliff-edge design forces claimants in England and Wales to forfeit their entire payment if they breach a £204 weekly earnings limit, even by a penny. Carer's allowance is £86.45 a week and is paid to people who spend 35 or more hours a week caring for a disabled relative. A Guardian investigation found that the Department for Work and Pensions failed to warn thousands of people it knew were being overpaid, which led to debts, hardship and hundreds of criminal convictions for fraud. A Guardian editorial welcomed the reform as overdue and said a taper is much better than a cliff-edge.

Timeline

1. The Guardian

   26 Oct 2026, 22:30 UTCSource ↗

   Reports that the rule penalising unpaid carers with thousands of pounds in lost allowance is to be abolished, with chancellor John Healey due to announce a new digital taper system for carer's allowance in Wednesday's budget, following a Guardian investigation.

2. The Guardian

   27 Oct 2026, 18:30 UTCSource ↗

   Editorial says the reform of carer's allowance is overdue and welcome, that a taper is much better than the cliff-edge design, and that the DWP's failure to warn overpaid claimants should have been fixed years ago.