In the Autumn Budget 2024, the Chancellor, Rachel Reeves MP, confirmed carers working and claiming Carer’s Allowance can now take on additional hours to earn up to £196 per week from April 2025, or over £10,000 a year.
Carers First welcomes what is the biggest increase to the earnings limit since the introduction of Carer’s Allowance. Carers in receipt of Carer’s Allowance will be able to work up to 16 hours every week at National Living Wage from April 2025.
Starting in April, the National Living Wage will increase to £12.21 per hour. This change means that carers will see an extra £45 each week, which adds up to an annual total of £2,340. They will still be eligible for the Carer’s Allowance as well. From April 2025, the new earnings limit will be set at £196 per week, allowing carers to earn up to £10,192 per year.
This is the first adjustment to the National Living Wage in decades, and it aims to address the concerns many have about having to reduce their working hours due to wage increases. We hope this brings some peace of mind to carers and helps them maintain their livelihoods.
Key facts
Earnings limit in Carer’s Allowance
Current: £151 per week
From April 2025: £196 per week
Number of hours those receiving Carer’s Allowance can work if they earn National Living Wage
Current: 13.2 hours a week
After April 2025: 16 hours a week
Carers in poverty
Support through Carer's Allowance is crucial for those who cannot manage both work and care. However, it remains the lowest benefit of its kind, at only £81.90 per week. Many carers are facing financial struggles due to high living costs and significant inflation. Currently, 1.2 million carers in the UK are living in poverty and urgently need help.
DHSC funding on social care
The Government is supporting local authorities with at least £600 million of new grant funding for social care.
Household Support Fund
The Household Support Fund will be extended for 2025-26 as a lifeline for lower income families needing additional support. Unpaid carers are mentioned in the Household Support Fund guidance as one of the groups able to access assistance through the Fund.
Universal Credit
In an announcement that will benefit those on Universal Credit, the new “Fair Repayment Rate” will limit Universal Credit repayments or deductions to 15% of the standard allowance. This will benefit the increasing number of carers on Universal Credit across the UK.
Winter Fuel Payment
The Pension Credit Standard Minimum Guarantee will increase by 4.1% from April 2025. This will mean that more of the poorest pensioners will become eligible to receive Pension Credit and therefore the Winter Fuel Payment.
Unfortunately, there are no mitigations for unpaid carers missing out on Winter Fuel Payments this winter, which will affect carers without support for rising heating costs.
Department of Education
Department for Education will receive £6.7bn, a 19% real-terms increase. That includes £1.4bn to rebuild schools in the greatest need. The schools budget will increase by £2.3bn to support the hiring of teachers. There will be £2.1bn for school maintenance, a £300m increase. This investment should positively impact young carers and carers in education.
* Source: Carers UK Autumn Briefing. Carers Trust Autumn Briefing
It is often common to worry about money, especially if you've had to reduce your hours or give up work due to your caring role. If you are a carer who is worried about money and feel in need of financial support, take a look at our page on accessing financial support as a carer.
For a detailed overview of the cost of living support being provided by the government, take a look at the Cost of Living Government Guidance on the gov.uk website. All the budget documents are available on gov.uk
Online Help and Advice
Visit our online support section where we have provided advice and guidance on a range of relevant topics to help you in your caring role.