The Department for Work and Pensions (DWP) is raising the state pension age to 67 between 2026 and 2028, a change that will cost households £182 a week. Around 26,000 unpaid carers who look after family members or friends are expected to miss out on £7,011 a year, or £134.82 a week, due to the gap between working-age benefits and those available at pension age.
Impact on Carers' Income
Analysis by Carers UK reveals that a working-age carer receiving Carer's Allowance, the Carer Element, and Universal Credit is entitled to £138.68 per week. In contrast, a carer who has reached state pension age receives £273.50 per week. This £134.82 difference accumulates to over £7,000 annually, pushing many carers into financial hardship.
Rising Poverty Among Unpaid Carers
Previous research by Carers UK estimates that around 600 people a day leave work to provide care, increasing financial vulnerability. Across the UK, 1.2 million unpaid carers live in poverty, facing a higher risk of financial hardship than those who do not provide care. The state pension age rise exacerbates this issue, particularly for women, who make up the majority of carers affected.
Call for Reform
Carers UK is calling for a review of Carer's Allowance to ensure it meets carers' needs. The organisation recommends that carers receive an enhanced payment at least two years before retirement to reduce the impact of poverty in later life.
Emily Holzhausen CBE, Director of Policy and Public Affairs at Carers UK, said: "Thousands of unpaid carers provide essential support to family and friends long before reaching pension age. As one of the most under-pensioned groups in the UK, many have little choice but to care due to limited alternative support. We must ensure carers are properly supported as they approach retirement, particularly given the new rise in the state pension age. This change means that those nearing retirement age will lose out significantly, especially women, who make up the majority of those affected. It is vital that Carer's Allowance is reviewed and strengthened, including enhanced support in the years before reaching pension age, so that those who dedicate their time to look after others are not left in poverty."
