Liam Byrne Iain Duncan Smith
Liam Byrne said Iain Duncan Smith is the butt of a Whitehall joke (Reuters)

A row has broken out between Labour's Liam Byrne and the Department for Work and Pensions after the shadow cabinet minister attacked its implementation of welfare reforms, claiming that it "can't get the basics right".

Byrne, who is shadow work and pensions secretary, said the government's welfare reform programme would end up costing taxpayers an extra £1.4bn rather than save money because of waste and mismanagement, and that the rolling out of schemes such as Universal Credit has been "a disaster".

"Nobody wants to see a department that can't get the basics right - but that doesn't mean we can run away from the problem," Byrne said in a speech at youth support charity Chance UK.

"And there is no escaping the fact the government's failure will end up costing the taxpayer a staggering £1.4bn by the end of this parliament," adding that their promised welfare revolution has collapsed because of a failure in basic delivery".

He also hit out personally at Work and Pensions Secretary Iain Duncan Smith.

"There is now a private joke in Whitehall. To err is human, but to really foul things up you need Iain Duncan Smith," he said.

"It is beginning to feel like every single major reform is in crisis."

However, a spokesman for Duncan Smith said the speech is "a last ditch attempt by Liam Byrne to keep his job in the shadow cabinet" after weeks of speculation that he would be ousted during Labour leader Ed Miliband's impending reshuffle.

"[Byrne's] talk of wasted money is frankly laughable when you consider Labour have voted against £83bn worth of savings to the welfare budget," said the spokesman.

"Labour is panicking - after a summer of discontent, here is yet another disastrous speech, void of any ideas. Same old Labour is in the wrong place on welfare."

In Byrne's sights for criticism were several DWP schemes introduced by the coalition government, including universal credit, the "bedroom tax" or spare room subsidy, the Work Programme, and the Youth Contract.

He said Labour supports the principle of Universal Credit, but the scheme's "implementation is a disaster" and is an example of the "chaos" at the DWP.

Byrne claimed the roll-out difficulties would lead to an extra £300m in costs, but the department dismissed this as "complete nonsense".

"The chancellor allocated DWP £300m for 2015/16. The Treasury hadn't previously announced our budget for UC for that year, but obviously the department needs money for implementation for each year between now and 2017 while UC rolls out," said the DWP.

"This does not reflect 'extra' costs. The Treasury will allocate us money for implementation costs as you would expect. To characterise this as evidence of 'chaos' is a complete nonsense."