This is a rise of £8 on the previous limit of £102. The change means that more people will have the opportunity to work part-time and still be eligible for the full £61.35 a week Carers’ Allowance.

The Deputy Prime Minister said:

Carers are the lifeblood of the welfare system, and are vitally important to British society as a whole. It is important that we help people where they have made the choice to concentrate on caring for someone who is severely disabled, and I am delighted to be able to announce some extra help for those who provide such often thankless service.

Norman Lamb, Social Care Minister, said:

As the economy begins to recover and we raise the National Minimum Wage to help families on low incomes, it is right that the support we give carers keeps pace. So we have moved to make sure that the support we give to people who carry out valuable work caring for relatives and friends does so. This significant rise in the earnings threshold provides that reassurance.

Carer’s Allowance is a non-contributory benefit available to people who have given up the opportunity of full-time paid employment in order to provide substantial care, of at least 35 hours a week, to a severely disabled person.

Being out of the labour market place for a long period can have a negative impact on individuals. The government recognises that many carers would like to combine some paid work with their caring duties, wherever possible. The earnings rule in Carer’s Allowance enables carers to maintain a link with the labour market and achieve greater financial independence.

The net earnings figure is calculated net of income tax, National Insurance contributions, half of any contributions to an occupational or personal pension, plus a number of other allowable expenses. In addition, half the net earnings figure calculated as above can be allowed towards the cost of alternative care for the disabled person, or for a child aged under 16, while the carer is at work.

More support for carers from the coalition government

The Care Act extends carers rights to an assessment, which will be based on the appearance of a need for support. It will also consider the impact of caring on the carer and the outcomes they wish to achieve.

For the first time, local authorities will have a duty to meet carers’ eligible needs for support based on an eligibility framework that has been set out in draft regulations.

We have also ensured that young carers and parent carers of disabled children are supported through the provisions of Children and Families Act: their assessments will be on the same footing as adults caring for adults.

We have provided £400 million to the NHS over 4 years from 2011 for carers to have breaks from their caring responsibilities. The 2015 to 2016 tranche of this funding (£130 million) will be part of the Better Care Fund.

From 30 June 2014, the government extended the right to request flexible working to all employees after a 26-week qualifying period.

The Department for Education has also provided £800 million funding to local authorities to fund short breaks for disabled children and their families.

NHS England recently published a Commitment to Carers and are currently consulting on an action plan to make this a reality.