The Department of Work and Pensions needs a management and cultural overhaul if it is to restore public trust after the benefits scandal which left hundreds of thousands of unpaid carers in debt, a key government adviser has warned.Prof Liz Sayce led a scathing review of the carer’s allowance scandal, which found the DWP system and leadership failures were responsible for carers unknowingly running up huge debts, some of which resulted in serious mental illness and, possibly, criminal convictions for fraud.Sayce told the Guardian she had been surprised by the DWP’s “lack of organisational curiosity” about the impact of the problems with carer’s allowance, as well as its reluctance to tackle the issue strategically, despite being aware of the issues for years.Her comments came days after the Guardian revealed a top DWP civil servant, Neil Couling, had insisted carers were to blame for the department’s failures in an internal message to staff, issued a few days after Sayce’s report was published.Sayce said it had been “distressing” to read Couling’s comments which she said were “clearly not right”.

His view, published in an internal DWP blog, contradicted a key finding of her seven-month review, accepted by ministers, that a confusing and complex system was to blame for the scandal, rather than individual carer error.“I was really distressed at the idea that the message would go to all the people working in DWP because as I have said a lot of people working in DWP want to do the right thing and probably that wasn’t the message that they’d taken from the review and what ministers had said.So I found it distressing.”Sayce said her review had revealed a “mixed culture” in the DWP – staff who wanted to “learn and improve” and others who took a more corporately defensive approach.She added: “It’s very interesting how organisations behave when they feel they are threatened.

”She said it would be interesting to see “which strands of this culture win through” as the DWP prepared to launch in the new year a three-year, £75m plan to review past overpayment cases and improve systems in a bid to prevent carer’s allowance injustices occurring in future.Last week the welfare secretary, Pat McFadden, rejected Couling’s comment that individual failings by carers were “at the heart” of the issue and effectively confirmed that his comments were “not the position” of the department.McFadden said: “This was a longstanding problem that was ignored by the previous government.We commissioned a report and support that.We are going to fix the issues with payments by carers.

”Sayce also paid tribute to a DWP whistleblower for his determination to ensure the carer’s allowance failures came to light.She said the whistleblower’s evidence had been important to her review.“It’s not easy to raise issues in a big system [like DWP] and he deserves thanks for continuing to raise those issues across time,” she said.The government-commissioned Sayce review was ordered after a Guardian investigation revealed how unpaid carers had been unfairly hit with draconian penalties of as much as £20,000 after unknowingly running up overpayments of carer’s allowance benefit.Sayce said she was pleased the DWP had accepted most of her review’s 40 recommendations, but said the government’s refusal to follow her advice to change the way carer’s allowance overpayments were recorded was a “missed opportunity.

”She said it was “regrettable” the government had rejected her recommendation to change what she had identified as confusing official guidance on the kinds of allowable expenses carers were allowed to set against weekly earnings limits.The lack of clear guidance meant some carers had unwittingly run up overpayments, she said.Asked whether unpaid carers may have received a criminal record as a result of DWP system failures, she said: “It’s possible … [that where a] case went through to the CPS, people may have pleaded guilty in order to avoid a worse sentence even if they didn’t think they did anything wrong.I don’t know.But those are possibilities that are of concern.

”Sayce praised ministers for tackling the carer’s allowance issues: “This is a real step forward.There’s been real commitment from ministers to make this happen.So while there’s further to go, it’s very important to welcome the commitment … I think this will make some significant changes for the better.”Ministers have ordered about 200,000 historical cases to be re-assessed, and say about 26,000 carers were likely to have debts cancelled or reduced.“Transparency is the key to building trust [with carers].

So if people are thinking [these figures] might be on the low side, then they [the DWP] need to explain the criteria.”Although Sayce did not name the whistleblower, it is understood to be Enrico La Rocca, a junior official in the carer’s allowance department whose internal warnings were repeatedly ignored or silenced by senior managers for years.His evidence led to an MPs investigation into carer’s allowance in 2019.Although the DWP permanent secretary, Sir Peter Schofield, assured MPs at the time La Rocca would be protected, he was sacked in 2020.He was reinstated in 2021 after MPs intervened.

Ministers intervened again this year after La Rocca’s bosses tried to block him from giving evidence to the Sayce review.Schofield’s responsibility for the DWP’s carer’s allowance scandal has come under scrutiny.In 2019 he failed to apologise to carers but promised to fix the overpayments problem.Last week he told the public accounts committee: “I am sorry for all of those who are affected by this, but I am going to sort it out.”A DWP spokesperson said: “We inherited a system that let carers down – but we’re taking decisive action to put things right and rebuild trust and are grateful to Liz for her work to highlight these issues.

“We’ve accepted the vast majority of the Sayce review’s recommendations and we’re already making changes.We’ve hired extra staff to stop carers building up large debts, updated internal guidance, and made sure letters clearly explain what changes carers need to report.“And we will continue putting things right by reassessing affected cases, and potentially reducing, cancelling or refunding debts for tens of thousands of carers, as well as working to modernise the benefit so this doesn’t happen again.”