Select committee: Public Accounts Committee
Recommendation 7
66th Report - Tackling fraud and error in benefit expenditure 2024-25
Published 11 Feb 2026
Addressed to HM Treasury
Public Accounts Committee Tackling fraud and error in benefit expenditure 2024-25 All items in this report Report on parliament.uk ↗ Inquiry on parliament.uk ↗
Recommendation (the committee's words)
Inaccurate operational guidance has led the Department to incorrectly assess around 26,000 carers as having been overpaid Carer’s Allowance. The main cause of Carer’s Allowance overpayments is claimants having earnings which exceed the permitted limit. The Independent Review of Carer’s Allowance Overpayments, which was published in November 2025, found that the prevalence of earnings- related overpayments had been caused by systemic issues that prevented carers from fulfilling their responsibility to report information about their circumstances. This included the Department having operational guidance that was inconsistent with the governing regulations and that did not allow staff discretion to average fluctuating earnings where claimants had an irregular earnings pattern. The Department estimates that, over the past 10 years, about 26,000 people were incorrectly recorded as having been overpaid Carer’s Allowance as a result. It has committed to put this right and believes it will take around two years to identify all those affected, with 200,000 cases reviewed in the process. A lack of integrated, concerted leadership from the Department allowed this issue to persist, and it must now work quickly to provide redress to the people affected. recommendation Within six months, DWP should write to update the Committee on its progress with identifying and resolving the cases of carers affected by its inaccurate guidance. 6 1 Levels of fraud and error Introduction
From: Public Accounts Committee, 66th Report - Tackling fraud and error in benefit expenditure 2024-25 (HC 1231), 11 February 2026
Government response
The government responded to the whole report on 7 April 2026 (deadline 11 April 2026).
Summary written by Accountability Index from the government's response. It is not the government's own words.The government agrees with most of the Committee's recommendations, stating that several are already implemented, but disagrees with two: setting a more stretching overpayment ambition and updating people who report suspected fraud.
- On a more stretching overpayment ambition, the government disagrees; the department is working with the NAO to agree what constitutes a cost-effective control environment and is "not yet able to accept this recommendation" until then. It aims to reduce fraud and error to 2.8% by 2028-29.
- On spending the £3.5 billion of dedicated funding, the government agrees and says the recommendation is implemented. It states the department has committed to gross savings of £14.6 billion up to the end of 2030-31 from fraud, error and debt activity.
- On the Public Authorities (Fraud, Error and Recovery) Act 2025, the government agrees. It states it is the department's intention to include "proportionate and appropriate reporting" on the powers in its Annual Report and Accounts as they are implemented.
- On carers affected by inaccurate guidance, the government agrees and says the department will write to the Public Accounts and Work and Pensions Committees every six months, with the first update in September 2026.