Dundee West Labour
3 March 2019
Working carers on the national living wage face losing their entire Carer's Allowance payment, thanks to the SNP’s decision to uprate in line with CPI, rather than RPI.
The SNP has followed the Tories’ lead and uprated Carer’s Allowance by CPI rather than RPI.
Both CPI and RPI measure inflation. Each aim to measure the changes in the cost of buying a 'basket' of products, but they cover different items and differences in formulae used to calculate the inflation rate mean that CPI is often lower than RPI.
One of the first major welfare cuts made by George Osborne was to move from uprating by RPI to CPI.
Carer’s allowance has an earning threshold which sees people lose eligibility for a payment, and uprating the threshold by CPI means it will not keep pace with the national Living Wage.
Carers who work could be forced to ask their employer to reduce their working hours or face losing out on carers allowance altogether.
The SNP voted down proposals from Labour this week to ensure the payment is uprated by RPI rather than CPI.
Analysis confirmed by the Scottish Parliament Information Centre (SPICe) shows that uprating by RPI would cost £2.8m in 2019-20, with 82,000 carer’s £33 per year better off.
On Thursday, Ministers confirmed they will not make any changes to Carer’s Allowance until 2024 at the earliest.
Scottish Labour Social Security spokesperson Mark Griffin said:
“Work should always pay, but the thresholds around the Carer’s Allowance will force carers to consider reducing their hours, stop working completely or lose out on Carers Allowance, that’s why Labour believes the allowance and threshold should be uprated by RPI as a starting point.
“For years the SNP has said it will deliver a social security system based on dignity and respect but instead ministers are simply copied the Tory approach when it comes to uprating the payments.
“Instead of supporting carers the SNP is short-changing carers and could leave them worse-off.
“Day-in, day-out, carers work tirelessly to care for their loved ones but, since 2010, they have lost out on thousands because of the Tory’s switch to CPI, a decision this week the SNP shamefully endorsed."
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