Recovery of benefits claimed fraudulently or paid out by mistake has hit a record high of £1bn, according to the Department for Work and Pensions.

It says 5,000 people were prosecuted last year for benefit fraud and 6,000 'administrative penalties' were imposed.

At the same time the amount paid as a result of error or fraud has fallen in the past six years to 1.9% of the total Government bill.

Minister for welfare reform David Freud said: 'We will not tolerate fraud and will pursue those who try to cheat the system.

'We have strengthened penalties and powers to combat fraud and error in the benefit system and are introducing reforms, such as Universal Credit, which will reduce fraud and error and is expected to save £1bn when fully rolled out.

'Many deserving people rely on benefits when hard times hit, so it’s vital we stop those who try to divert funds away from them and maintain a system that is fair to those who use it and those who pay for it.'

For more on the National Fraud Initiative (NFI) read our feature, 'Fighting welfare fraud in real time.'