Government departments do not fully understand the overall impact of an array of different means-tested benefits on incentives to work, a cross-party committee of MPs said on Thursday.
The Public Accounts Committee (PAC) said a single body needed to take responsibility for ensuring the £87bn of income-related allowances did not discourage people from working.
There are currently 30 different means-tested benefits handled by nine Whitehall departments and 152 local authorities.
The new Universal Credit is designed to make the welfare system simpler and more effective, but the PAC urged that it must take account of other means-tested awards such as council tax benefit and higher education bursaries.
In response Alison Garnham, chief of the Child Poverty Action Group warned the report indicated the government could fail in its bid to reform welfare for the better: “Multiple means-tested benefits will continue to exist after the introduction of Universal Credit in 2013 causing confusion, burdensome administration and disincentives to work.
"Unless one department is prepared to take responsibility for the overarching impact of means testing, the Government will be unable to deliver on its important objectives of simplifying the benefits system and making work pay.”
Labour MP Margaret Hodge, chair of the PAC, said: "At present, there are nine central government departments and 152 local authorities administering 30 different means-tested benefits, yet there is no one body responsible for co-ordinating means-testing across government.
"There needs to be a single body responsible for overseeing the interaction between different benefits, means-tested or not, and ensuring consistency and value for money."