At least 240 people in Bradford have been unlawfully charged the ‘bedroom tax’ after a Government blunder.
They are residents who have lived in the same local council or housing association property since 1996 – making them exempt from the controversial measure.
But they have wrongly been deducted hundreds of pounds of their housing benefit, because they were deemed to have spare bedrooms.
All must now be refunded, after the Department for Work and Pensions (DWP) admitted tenants in the same home for more than 17 years should not have been hit.
Bradford Council is scrambling to arrange refunds for all 240 tenants, to clear up a mess not of its making – and may yet find more people affected.
A spokesman said: “So far, 240 people in the Bradford District have been discovered to have had the charge wrongly applied. That figure may increase as more come to light.
“We will be revising claims to April 1 last year and sending out arrears of housing benefit. We expect it will take up to two weeks to amend the claims.”
At Westminster, Labour seized on the figures to warn the bedroom tax – which it has vowed to axe if it wins back power – had become “farce”.
And it accused ministers of misleading people about the blunder, having claimed only 5,000 residents would be hit nationwide, when the real figure was up to 50,000.
However, the party’s bid to prevent the Government closing the loophole – to ensure no one else escapes the clampdown – was easily defeated in the Commons.
Chris Bryant, Labour’s welfare spokesman, said: “The bedroom tax has been a fiasco from start to finish and now the Government has been caught out trying to downplay how many people are exempted by it.
“At this rate the total will be nearly 50,000 households, each of them overcharged by an average of £640. That’s £3,072,000 that will have to be repaid.
“This would be a farce if it weren't for the upset this has caused many vulnerable families and the huge cost to taxpayers.”
The removal of the ‘spare room subsidy’ – the Government’s term – cuts housing benefit by 14 per cent for one extra bedroom and 25 per cent where there are two. Ministers say the policy will save £500m.