Tenants could have been wrongly forced out of their homes and pushed into financial hardship as a result of a blunder by government benefits bosses.
It has emerged that some tenants hit by the government’s so-called ‘bedroom tax’ - which cuts housing benefit for people in social housing who have spare bedrooms - should have been exempt.
The controversial change to benefit rules does not apply to tenants who have lived in their homes since 1996 and have continuously claimed housing benefit.
Around 40,000 people across the country are thought to have been wrongly hit by the tax after the loophole emerged.
Government ministers said they would close the loophole by March.
Hemsworth MP Jon Trickett said: “This is another example of the government getting it wrong and then compounding their mistake. Rather than closing up the loophole, the bedroom tax should be abolished.
“The government managed to give a tax break to millionaires of around £100,000.
“They should now immediately abolish the bedroom tax, which is penalising some of the most vulnerable people in our society.”
The bedroom tax was introduced in April 2013 and cuts housing benefit by an average of £14 per week for working-age people who are deemed to be ‘under-occupying’ their homes.