Most people who are disabled or sick applying for Personal Independence Payment undergo a face-to-face assessment to determine eligibility, which is carried out by the private contractors, but the committee said some claims were taking six months or more to process.
Some of the affected claimants are people with terminal illnesses.
Many disabled or sick people face waits of six months... even those with terminal illnesses are having to wait far longer than was anticipated.
This not only leaves people facing financial difficulties whilst they await a decision, but causes severe stress and uncertainty. It is completely unacceptable.
It is vital that all disabled people, but especially the terminally ill, experience as little delay and stress as possible in making a claim.
Basic failures - from appointments being cancelled without notice to unsatisfactory responses to queries about claims - are happening too often.
– Chair of the Work and Pensions Committee Dame Anne Begg MP
The MPs said the backlog of claims should be cleared and the average time taken to process new cases reduced to the expected 74 days, and seven days for terminally ill people.Claimants hit by delays were facing stress and uncertainty, said the committee.
Disabled and sick people are having to wait six months or more to find out if they are eligible for benefit, which MPs have attacked as "unacceptable."
The delays were criticised by the Work and Pensions Committee, which called on the Government to take urgent action to clear a backlog of cases.
The MPs also urged the Department for Work and Pensions (DWP) to invoke penalty clauses with assessment providers Atos Healthcare and Capital Business Services.
New claims for Personal Independence Payment (PIP), the replacement for Disability Living Allowance (DLA) as the benefit to help towards the extra costs of disability for people of working age, began in April 2013.
The Department for Work and Pensions has defended the new Personal Independence Payment, after a report suggested claimants were having to wait longer for their claims to be processed.
Margaret Hodge said the claims would cost almost three and half times more to process than the previous Disability Living Allowance system, and claimed the delays would cause "real distress" for vulnerable people.
However, the DWP defended the scheme claiming the previous system was "broken".
PIP is a completely new benefit with a face-to-face assessment, something missing under DLA, and there will always be initial costs so this is not comparing like with like.
The figures show good value for money for taxpayers in the short and long term, with expected savings of £3 billion annually by 2018/19.
Delays in processing the Government's new Personal Independence Payment (PIP) will cause "real distress for vulnerable claimants", the Public Accounts Committee chair has said.
Margaret Hodge said claimants were left facing "uncertainty and potential financial difficulties", after the National Audit service found claimants were having to wait longer for claims to be processed than under the previous system.
"I was shocked to learn that, not only will Personal Independence Payment claims cost almost three and half times more to administer than Disability Living Allowance, they also take double the amount of time to process," the Labour MP said.
"The current backlog and delays in processing claims are simply unacceptable and will no doubt cause real distress for vulnerable claimants."
Disabled people are facing "distress and financial difficulties" as a result of the slow processing of claims under a new Government benefit scheme, a spending watchdog has found.
The National Audit Office found that claimants for the new Personal Independence Payment, which will replace Disability Living Allowance, were waiting an average 107 days for a decision on their cases, rather than the predicted processing times of 74 days.
Terminally ill patients were found to be waiting for 28 days instead of 10 days.
A backlog of 92,000 cases had built up with private contractors Atos and Capita within six months of the introduction of PIPs in some areas of the north of England.
As major changes to disability benefits begin to come into force in the North of England today, the latest Index poll conducted by ComRes for ITV News reveals that the British public is deeply divided over the benefit reforms:
Two in five (41%) of the British public support the changes
one in three (36%) oppose them
one in four (23%) are undecided
The public think the changes being made to welfare system are necessary to make work pay (51%) but are divided over whether or not they are fair:
42% feel that that the changes made to the welfare system by the Coalition are unfair
18% do not know whether changes are unfair or not.
The minister for disabled people and Tory MP for Wirral West, Esther McVey, said changes to the benefit system are about "understanding disability in the 21st century" and adapting a system which will work better in the future.
The MP said the new scheme is not aimed at saving money.