It has been revealed that people on the DWP benefit Carer's Allowance have previously been sent letters demanding up to £20,000 in repayments.

However, a DWP overhaul offers fresh hope to thousands of carers who have been affected.

Households receiving carer's allowance currently face harsh repayments if their weekly earnings exceed the threshold.

Under current rules, unpaid carers who look after someone for more than 35 hours a week can claim the allowance as long as they earn less than £151 a week.

However, if carers are found to go over this limit by just a few pence, they need to pay back 100% of the benefit for that week, which is currently £81.90.

In April, the earnings limit will rise from £151 to £196 per week.

Now, a review, headed by Liz Sayce OBE, is tasked to examine how the crisis happened, how changes can be made to minimise the risks to carers, and how the Department for Work and Pensions (DWP) can best support those affected.

The Review is expected to report its findings and recommendations to ministers this summer.

Last year, The Guardian reported that the DWP had opted to investigate and flag only 50% of claimants who had received overpayments.

However, the Government has now pledged to ensure that all claimants (100%) who receive payments after exceeding the cliff edge will be investigated and proactively notified.

A DWP Spokesperson told the Sun: "Carers are unseen heroes and we have made the biggest ever cash increase in the carer's allowance earnings threshold to make their lives easier.

"We are drafting in extra staff so the backlog of all under and overpayments are investigated promptly and corrected.

"We will agree affordable repayment plans and when issuing debt management notifications, signpost to independent advice services.

"We are also furthering a trial of text message reminders to help carers to fully understand their responsibility to report changes in their circumstances."

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Dan White policy and campaigns officer at DR UK (Disability Rights UK) and an unpaid carer said: “Although this review is welcome and we are glad to be inputting into it, it is obvious that the fault lies with DWP and its errors and incompetence in relation to carers allowance, leading to enormous distress for carers and significant and unfair debt. 

“DWP failed to notify some recipients that they had been overpaid, for years. When carers were asked for repayment retrospectively, the debt owed was often in the tens of thousands of pounds, which to a carer struggling to survive, is grotesque.”

“In our written submission we show the devastating impact this has and is having on carers across the country and we make it clear what the solutions are, solutions that any responsible and empathetic government would take on board and action immediately.”