Benefits IT system project will be drip-fed money while it awaits approval.
The Treasury has not signed off on the Government's troubled Universal Credit benefit reform three months since receiving the business plan.
The Department for Work and Pensions (DWP) IT project is being drip-fed money instead of receiving full approval and funding from the Treasury, a normal procedure for major public projects.
Civil service chief Sir Bob Kerslake told the Public Accounts Committee (PAC) this week: ""We shouldn't beat about the bush. It hasn't been signed off. What we've had is a set of conditional reassurances about progress and the Treasury have released money accordingly. That is one of the key controls."
It is the latest in a series of startling revelations about the Universal Credit IT system, designed to simplify six benefit payments into one, and comes after the National Audit Office (NAO) announced plans to launch a second investigation into the welfare programme this autumn.
The DWP had originally planned to launch the benefits system last October, but it was reset in December 2013 after a series of IT problems and wasted costs, with Work and Pensions minister Iain Duncan Smith admitting the project was unlikely to hit its original full roll-out deadline of 2017.
It is currently in use across 10 areas of the UK, according to the DWP, and, as of February (the latest available figures), 6,000 people were using it to claim.
While the concept of streamlining benefits has cross-party approval, Labour has pledged to 'pause' Universal Credit to conduict a three-month review if the party wins next year's general election.
In November last year the PAC estimated that much of the £425m spent up to that point on the project may have to be written off as wasted costs.
A DWP spokeswoman said: "Universal Credit is a vital reform that will ensure we have a welfare system that means people are better off in work than on benefits.
"The facts remain that Universal Credit is on track to roll out safely and securely against the plan set out last year. It is already transforming people's lives and is available in a growing number of areas, including 24 Jobcentres, and last week expanded to claims from couples.
"The Treasury has been fully engaged - they have approved the rollout plan and have approved all funding to date."
Source: Company Press Release