The Guardian (p11) reports that council officers are blaming the government for the increased fraud because of a ministerial ruling last April that local authorities must provide watertight evidence of fraud before they can cut benefits.
And it is estimated that an extra£200m will be lost nationally this year as a result of the changes.
Southend BC, which recouped£1.9m in housing benefit fraud last financial year, has only recouped£500,000 so far this year, with only three months left of this financial year.
'In the last two years Bexley has had little difficulty in meeting its targets. However, the DSS's latest interpretation completely alters the situation,' the council said.
A DSS spokeswoman said that ministers had tightened the rules for cracking down on benefit fraudsters, who cost the government£4bn a year because local councils were themselves making exaggerated claims of fraud.
Alistair Darling, the social security secretary, last night issued a statement defending the government's handling of benefit fraud, pointing out that his department is spending an extra£100m to tackle housing benefit fraud.
'I have ended the money-for-nothing culture,' he said. 'The new system of housing benefit fraud targets produce real savings, not fictitious ones.'