Keir Starmer has called for fairer treatment of unpaid carers plunged into poverty after being forced to pay back thousands of pounds – and in some cases facing criminal prosecution – for minor breaches of benefit rules.

Last week the Guardian revealed thousands of carers had run up big debts, were given criminal records and forced to sell their homes when chased by the Department for Work and Pensions (DWP) over “honest mistakes” that officials could have spotted years earlier.

These include George Henderson, who had to sell his home to repay a £20,000 DWP penalty imposed for a carer’s allowance rule breach, and Karina Moon, forced to repay £11,000 after inadvertently earning just £3 a week more than rules allow.

Last month the DWP admitted that Henderson had probably been telling the truth and that the false declaration he had been accused of “was an innocent mistake” – but it has refused to pay back the penalty. Henderson, whose health was shattered by the experience, became homeless and is now in sheltered accommodation.

The Labour leader was asked by BBC journalists about the case of Vivienne Groom, who was prosecuted for fraud in November and had a £16,000 inheritance seized by the department after she admitted to breaching earnings rules she says she was unaware of.

Groom claimed the then £60-a-week carer’s allowance from 2014 to 2019 while working part-time at the Co-op and caring at least 35 hours a week for her mother who had dementia and had suffered a stroke. She says she was advised by a social workers this was in the rules but the DWP caught up with her in 2021.

She had already agreed to repay in instalments £16,000 worth of carer’s allowance overpayments when the the DWP used proceeds-of-crime laws – normally used to seize assets owned by convicted major criminals – to take the £16,000 bequest left to her by the mother she cared for.

“We cannot allow that to happen again,” Starmer told the BBC. He added that “something has gone very wrong here”, and said the benefit system “has got to be fair to those that were providing the care in the first place”.

During the visit to Barrow-in-Furness last Friday, Starmer said: “From a human point of view you’ve got individuals and their families who, through no fault of their own, have got into this position where the government is now asking them to repay money.”

Starmer’s intervention is likely to increase pressure on ministers to act on the carers’ overpayment scandal. His comments follow the Liberal Democrat leader Ed Davey’s call for ministers to “stop treating carers like criminals” over carer’s allowance overpayments, and interventions by both Labour and Conservative former work and pensions secretaries who called for a pause over recovery of the debts.

Carer’s UK renewed calls for major reform of carer’s allowance to protect carers from overpayments. “There’s not a moment to lose for reform, carers have been waiting far too long for this,” said the charity’s director of policy, Emily Holzhausen. “Their support for older, disabled and ill relatives and friends is worth billions every year. They need and deserve better.”

The repayments build up rapidly because even if the weekly earnings limit of £151 is exceeded by as little as £1, claimants become automatically ineligible for the entire carer’s allowance resulting in a “cliff edge” repayment penalty. DWP administrative failures have been blamed for allowing overpayments to build up over months and years.

In 2022-23, 26,700 carers were asked to repay sums relating to earnings breaches. More than 800 were repaying sums between £5,000 and £20,000, and 36 were repaying more than £20,000.

A DWP spokesperson said: “Carers across the UK are unsung heroes who make a huge difference to someone else’s life and we have increased carer’s allowance by almost £1,500 since 2010.

“We are committed to fairness in the welfare system, with safeguards in place for managing repayments, while protecting the public purse.

“Claimants have a responsibility to inform DWP of any changes in their circumstances that could impact their award, and it is right that we recover taxpayers’ money when this has not occurred.”