Only one in 100 benefit cheats ends up in prison

Only a third of cases made it into court, while the rest - around 12,000 - were given a caution.

Last night, the Conservatives claimed Labour's supposed crackdown on benefit fraud had been exposed as a sham.

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James Clappison, the Tory work and pensions spokesman, said: "The Government has talked tough on benefit fraud but the small print behind it all shows the number of convictions and sentences is going down."

Blair Gibbs, of the TaxPayers' Alliance said: "Benefit fraud is stealing from the taxpayer - plain and simple.

"Theft with deception warrants a spell in prison if it's going to be a serious deterrent to others. Any progress civil servants have made in recent years in tackling benefit abuse is being completely undermined by these lax court sentences.

"Taxpayers are being defrauded every day but cheating welfare seems to be just another crime that pays in Britain - and all because the Government hasn't built the necessary prison capacity to house those who deserve a custodial punishment."

Benefit fraud costs the UK £ 700million a year, according to official figures.

It has prompted the Government to commission a series of anti-fraud TV and radio adverts and even introduce lie-detector tests for those applying for benefits.

Last year, then Welfare Secretary John Hutton insisted: "Benefit fraud is theft. We are committed to catching benefit thieves and bringing the toughest penalties against those who commit this crime. No ifs, no buts.

"The public are fed up with benefits thieves stealing money intended for society's most vulnerable. There are no excuses for taking money that isn't yours."

But Government figures reveal the number of cases reaching court has actually fallen over the past seven years.

In 1999/2000, 445 of the 8,768 cheats convicted of benefit fraud were jailed. A further 5,548 were given a caution.

By 2005/06, the number of those cautioned had almost doubled to 10,543, with 411 being sent to prison. Some 8,103 were taken to court charged with defrauding the State.

Last year, there was a 14 per cent rise in the number of cautions - which carries no fine or other criminal sanction - to 11,976.

Two out of every three cases are given the legal equivalent of a slap on the wrist.

The number convicted by magistrates or the crown court fell to 6,332, with only 262 jailed.

The Government has spent hundreds of thousands of pounds on tough anti-fraud TV and radio adverts, claiming investigators "work relentlessly, never take a day off and don't even sleep".

Many councils are even insisting those applying for benefits pass a lie-detector test, which can tell if an applicant is lying by monitoring stress levels in their voice.

A spokesman for the Department for Work and Pensions said: "Sentencing is a matter for the courts but we will always seek to impose the heaviest penalties on those who steal from the taxpayer.

"If you are found guilty of benefit fraud you will end up with a criminal record and will have to pay back the money you stole.

"We have a strong record on tackling fraud in the benefit system and have reduced total benefit fraud by two thirds since 1997.

"Our message to those people considering benefit theft is simple: Don't do it. There are no ifs, no buts - we will catch you."