Shadow work and pensions secretary Liam Byrne has said that as the government's emergency fund runs out even more people will be pushed in to debt over the 'bedroom tax'.
Mr Byrne said: "It is very early days and that's why these figures are so shocking because the policy has only been in place five months one in three people are in debt.
"Now what's going to happen over the next few months is that the government's emergency fund is going run out, people's personal resources are going to run out and so this figure is only going to get worse."
Labour's Shadow work and pensions secretary Liam Byrne has described the Universal Credit scheme as a "Titanic-sized IT disaster" and accused the Work Secretary Iain Duncan Smith of a cover up.
Liam Byrne will speak about this on Daybreak later this morning
Key points from Mr Byrne's speech will include:
- The biggest cost will come from extra job seeker allowance claims because of the slow take-up of the youth contract.
- Current targets will be missed by 92 percent which will cost the Treasury by £457 million.
- Implementing universal credit will cost £300 million, failures by Atos £287 million and work programme £140 million.
- The bedroom tax will cost £102.5 million.
- Rising fraud and error cost the Treasury £140 million.
Liam Byrne is expected to propose Labour focus on the costs of "delivery problems", such as the cost of implementing universal credit, before they tackle benefits:
The taxpayer is facing bills of an extra £1.4 billion because of the "chaos" at the Department for Work and Pensions (DWP) who are ushering in huge changes to the benefit system, Labour will say.
The low take-up rates for youth contracts, rising fraud, problems in the delivery of work capability assessments and the cost of implementing universal credit will all be criticised in a speech by Liam Byrne.
Shadow work and pensions secretary will claim bills for Iain Duncan-Smith's reforms will run into the next Parliament.
Mr Byrne will repeat Labour's call for a bankers' bonus tax to fund a jobs guarantee for young people.
A great deal of political capital was made of the note left at the Treasury, when Labour left office, which said there was "no money".
Now it has been shown in public for the first time to ITV News.
ITV News Political Editor Tom Bradby reports on why it might suddenly have appeared now:
Our Political Correspondent Bob Constantine talks exclusively to Yeovil MP David Laws about the infamous treasury note he received. This is the full interview.
Liam Byrne has admitted to ITV News West Country that his note to his successor David Laws that said "I'm afraid there is no money" was "foolish":
David Laws has told ITV News West Country he had not meant to cause any embarrassment to his Labour predecessor at the Treasury, Liam Byrne, when he publicly mentioned the note left for him.
Mr Laws said: "I didn't set out particularly to embarrass Liam, but he'd left a note which frankly does sum up precisely the state of the Treasury when he left it - which was completely empty of money."