Over £70million was lost to fraudsters or wrongly paid out every week, an increase of £200m on the previous year.
The Department for Work and Pensions admitted more than £2 of every £100 paid out in welfare is now a “mistake.”
James Price, campaign manager at the TaxPayers’ Alliance, said, “We have to crack down on benefit fraud wherever we find it.
“It’s not just stealing from hard-pressed taxpayers but takes money away from those who need it most.”
A total of £1.46bn was lost to housing benefit fraud and error while £650m was wrongly paid out in employment and support allowance and £320m on pension credit.
A DWP spokesman said, “Last year we recovered a record £1.1bn, with over 5,000 people convicted.
“Levels of benefit fraud remain very low, but we are tackling the small minority who try to cheat the system by working closely with police and local authorities, developing new fraud detection technology.”
