Tens of thousands of sick and disabled people are owed more than £1bn in back benefits after they were underpaid by the Department of Work and Pensions (DWP).
The DWP said an “historic error” meant 180,000 people receiving Employment and Support Allowance (ESA) have not been paid their full entitlement and could be owed an average of £5,000 per person.
The mistake happened between 2011 and 2014, when incapacity benefit was switched to ESA.
Over the next two years £970m will be paid back, however when ongoing payments are taken into account the total amount could reach £1.67bn by 2024-25.
A DWP spokesman said, “Anyone affected by this historic error will receive all of the money they are entitled to.
“That is why we have created a dedicated team of over 400 staff to examine cases, and have paid back around £120m so far.
“We have worked with charities and other disability organisations to make sure that we are providing the right support to all affected claimants and are hiring and allocating more staff to do that.”
Marsha de Cordova MP, Labour’s shadow minister for disabled people and former member of Unite’s national disabilities committee, said the Tories are ultimately responsible for the underpayments.
She said, “Disabled people have been short-changed and denied the social security they were entitled to. This mess is another example of how the Conservatives have created a hostile environment for sick and disabled people.
“The government must ensure that disabled people who have been so unfairly treated are properly compensated. A government that forces disabled people into debt and even makes some destitute is a disgrace.”
Chair of Unite’s national disabilities committee Sean McGovern agreed that providing compensation “is the right thing to do”.
“But it doesn’t change the fact that the policies of this government pushed sick and disabled people into misery though their so called mistakes. People have died penniless, committed suicide and been made homeless,” McGovern said.
“It is ironic this has emerged just as warnings about the damage Universal Credit will do are coming thick and fast. The government must learn from this scandal and scrap Universal Credit before it inflicts even more suffering.”