The deputy prime minister Nick Clegg said that the Lib Dems no longer support the policy in its current form and now want an exemption for disabled people and for housing benefit to only be cut if households refuse an offer to move. 

The proposals are now expected to be part of the party’s 2015 election manifesto. 

The chief secretary to the treasure, Danny Alexander, wrote in the Mirror yesterday that, following the publication of a damning report by the Department for Work and Pensions (DWP),  It’s clearly time to take stock and change our approach in this particular area.’ 

Inside Housing broke the news that the Lib Dems were likely to oppose the bedroom tax in 2015 in February and that the party were proposing to overhaul the bedroom tax in March.

Figures in the DWP report showed nearly 60% of the 550,000 tenants affected were in rent arrears and only one in 20 had been able to move to a smaller home.

Rachel Reeves, Labour shadow work and pensions secretary (pictured, left), said: ‘This is unbelievable hypocrisy from Nick Clegg. The Lib Dems voted for the bedroom tax. There wouldn’t be a bedroom tax if it wasn’t for the Lib Dems. And in February when Labour tabled a bill to scrap the bedroom tax, the Lib Dems were nowhere to be seen. This just goes to show why you can’t trust a word the Lib Dems say - it is clear the only way to cancel the bedroom tax is to elect a Labour government next year.’