CHANCELLOR Rachel Reeves was branded “deluded” by disability campaigners today after suggesting an extension to her benefit fraud crackdown will help balance the books in tomorrow’s Budget.

The Labour minister has pledged to extend targeted case reviews, which root out inaccuracies in universal credit claims, with the aim of bringing in an extra £1.2 billion by March 2031.

While she is expected to announce the long-awaited scrapping of the two-child benefit cap at a cost of about £3bn, she is also expected to raise taxes to bridge a multibillion-pound gap in her spending plans.

Disabled People Against Cuts co-founder Linda Burnip told the Morning Star: “I think Rachel Reeves must be even more deluded than we thought if she thinks she is going to raise more money from clamping down on benefit fraud which for PIP has never been more than 0.5 per cent and more recently has been zero. 

“We are already seeing people in receipt of social care having their universal credit claims closed wrongly due to having a separate bank account to pay for their social care which is not their money to spend on other items but which is provided by social services departments to solely fund their care. DWP is a complete shambles and not fit for purpose.

“Reeves also fails to grasp the very basic economic principle that growth of the economy will only happen if people have disposable income to spend.”

Fran Heathcote, general secretary of the Public and Commercial Services union which represents job centre staff, added: “A government serious about economic growth should fix the broken social security system and ensure that those with the broadest shoulders contribute more through a fair tax system. 

“There is far more to be gained from going after the billions of tax avoided or evaded by wealthy individuals or large businesses.”

And a spokeswoman for Momentum said: “Clamping down on benefit fraud rather than taxing wealth proves that this Labour government has got its priorities wrong.

“Targeting those at the bottom is not what the Labour Party was founded to do. 

“The government must ditch its plans for welfare reform and focus on rebuilding Britain by taxing the rich and investing in our public services.”

Ms Reeves announced the fresh welfare crackdown after the Conservatives and Reform sought to portray her as presiding over a rising welfare bill at the same time as bringing in billions of pounds in tax rises for working people.

She has faced weak economic growth, persistent inflation and an expected downgrade to official productivity forecasts while preparing her statement.

A Treasury source said: “We will never tolerate fraud, error or waste in the welfare system — every pound of taxpayers’ money should be spent with the same care with which working people spend their own money.

“That’s why the Chancellor is doubling down on this next week — extending targeted case reviews to save taxpayers billions and ensure help goes to those who genuinely need it, and safeguard taxpayers’ money so it can be invested in the public services we all deserve.”

The Chancellor could also hit more than 100,000 high-value properties with a levy that applies to those worth more than £2 million and could raise £400-£450 million, The Times reported.

Some 2.4 million properties in the top three council tax bands would be revalued to determine which would be subject to the surcharge.

People will be able to defer the cost until they die or move house to avoid forcing them to sell up, according to the newspaper.

After scrapping plans to raise income tax, she is expected to look to a “smorgasbord” of smaller measures to bring in cash.

She is thought to be considering bringing in a pay-per-mile tax for electric vehicle drivers and limiting how much workers can stash in their pensions under salary sacrifice schemes before paying National Insurance.

And she will reaffirm the government’s commitment to the triple lock on state pensions, and confirm that 13 million pensioners are set to benefit from an above-inflation rise next April.

Yet another extension of the freeze on income tax thresholds, which shifts the tax burden onto poorer workers over time, is also among rumoured measures.