News has emerged that thousands of social housing tenants who were hit by the so called Bedroom Tax stand to get a rebate because of a loophole in the Government’s welfare reforms. The Daily Mail’s Real Britain column unveiled the news on Wednesday and since then benefits experts have weighed in saying that more than 40,000 housing benefits claimants could profit from this mistake.

Ministers are now saying that the spare room tax, which reduces social tenants’ benefits if they have more bedrooms than they need, doesn’t apply to certain renters who have been in the same home for 17 years or more. The Department of Work and Pensions estimate that only 5,000 people will be affected by the oversight. Local authorities are currently writing new regulations which will rectify the situation but that’s not gone down well with the opposition party.

Shadow welfare minister Chris Bryant called the mishap: “the latest example of the chaos and confusion within the Department of Work and Pensions under Iain Duncan Smith.” He went onto say: “Rather than closing loopholes in the policy, the Government should scrap their hated Bedroom Tax. If they don't, the next Labour government will.”

The error will affect social tenants whose claims haven’t changed since 1996. They were covered by the old regulations which the government failed to change under their welfare reform initiative. The refund amount could be worth as much as £640 per claimant and it will affect one in every twenty five housing benefit claimants.

The Department for Work and Pensions has already responded to the news: “We are looking at this issue carefully and working with local authorities, and we will take any necessary action in due course.” They added: “We expect very few people to be affected.”