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Iain Duncan-Smith: ''It is about fairness''
MPs are to vote on controversial government plans to put a 1% cap on annual rises in working-age benefits and some tax credits until 2016.
Benefits have historically risen in line with the rate of inflation, and increased by more than 5% in 2012-3.
Labour, which opposes the cap, says it will result in a real-terms cut in support for millions of working people.
The coalition says public sector pay is capped at 1% and benefits should not be rising at a faster rate than wages.
Work and Pensions Secretary Iain Duncan Smith said inaction would leave the UK "bankrupt", and that "like Greece and like Spain... we'll have huge borrowing costs".
He told BBC Radio 4's Today programme the last Labour government had created an "outrageously messy system", which had to be reformed.
'Not demonised'Mr Duncan Smith added that benefits payable to pensioners, including the Winter Fuel Allowance, were not being capped because older people had "less flexibility" and did not have the option of finding work.
"We are all going to be pensioners at some time. No-one is going to be demonised on my watch," he promised.
Benefits set to be capped
- Jobseeker's Allowance
- Employment and Support Allowance
- Income Support
- Elements of housing benefit
- Maternity allowance
- Sick Pay, Maternity Pay, Paternity Pay, Adoption Pay
- Couple and lone parent elements of working tax credits and the child element of the child tax credit
No cap could be placed on pensioners' benefits during this parliament, Mr Duncan Smith argued, as the Conservatives had made a "clear commitment" to this in their 2010 general election manifesto.
Prime Minister David Cameron and his deputy Nick Clegg have said they do not "relish" imposing the cap but argue billions of pounds of further savings are needed and have challenged Labour to come up with an alternative.
Legislation is needed to implement changes announced by Chancellor George Osborne in last month's Autumn Statement - to cap increases in jobseeker's allowance, employment and support allowance, income support and elements of housing benefit at 1% for three years from April.
The cap would also apply to maternity allowance, sick pay, maternity pay and paternity pay as well as the couple and lone parent elements of the working tax credit and the child element of the child tax credit.
'Vulnerable'These benefits traditionally rise in line with consumer prices in an annual process known as "uprating".
They increased 5.2% this year and without the planned change would have been set to rise by 2.2% - the rate of CPI inflation last September, on which the figure is calculated. The rate of inflation has since risen to 2.7%.
Analysis
Glance at the spreadsheets and the scale of the saving is apparent.
Figures in the Autumn Statement show raising many benefits and tax credits by 1% a year will save £2.8bn in 2015/16, compared with the government's previous plans.
The overall welfare budget in 2011/12, as calculated by the Institute for Fiscal Studies, is £201bn.
The political debate will centre on who should feel the pain.
Jobseekers Allowance totals 2.4% of the total bill, according to the IFS. Benefits for those on low incomes make up just under 21%.
Those for elderly people, including the state pension, make up over 42%.
The estimated value of fraud and error overpayments in benefit expenditure in 2011-12 is £3.2 billion.
Mr Duncan Smith said welfare payments had risen by about a fifth over the past five or six years while incomes had increased by only a tenth over the same period.
Ahead of Tuesday's vote, Labour leader Ed Miliband said the move showed the government had the wrong priorities, contrasting the planned cap with its decision to cut the top rate of tax for those earning more than £150,000 a year.
"By cutting the support that working families get - and more than 60% of those affected by the changes we are voting on are working families - that is going to be handicapping and stopping working families who want to get into work and do the right thing," he said.
He rejected reports some Labour MPs had misgivings about being seen to back an inflation-linked rise in benefits when most people had seen a real-terms cut in wages in recent years. "What we are voting for is a fairer way forward," he said.
"What we are saying is at a time when you are cutting taxes for the richest in society, that you penalise the most vulnerable in society and those going out to work, those people doing the right thing, the strivers that Mr Cameron says he stands for, it absolutely does not add up and it is the wrong thing to do."
Labour said it wanted to introduce a compulsory job guarantee - where a person unemployed for a couple of years will no longer receive jobseekers allowance, and they will have to take a job, or be helped towards getting one.
Former Liberal Democrat minister Sarah Teather has said she will oppose the government's proposal, as she is "deeply anxious" about the impact it will have on the poorest in society. She accused ministers of using language reminiscent of "playground politics" to justify the move.
It is not clear how many other Lib Dem MPs are likely to defy the government but the coalition is still expected to win the vote - expected at around 1900 GMT - on the second reading of the Welfare Benefits Uprating Bill.
'Reasonable'Lib Dem deputy leader Simon Hughes said the move was "reasonable" given the "decent" rise in benefits in recent years and pressure on pay in the public and private sectors.
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Shadow Work and Pensions Secretary Liam Byrne: ''This is a Bill that doesn't do what it says on the tin because it does nothing to get Britain back to work''
The cap, which will not apply to disability benefits, the state pension or pension credit, is estimated to generate annual savings of £1.9bn in cash terms by 2016.
The Department for Work and Pensions published research last week suggesting jobless benefits rose by 20% in the last five years, compared with an average 12% rise in private sector pay.
But campaigners argue the cap will see many families struggling.
"From a nurse with two children losing £424 a year by 2015, to the Army second lieutenant with three children losing £552 a year, this will hit children and families from all walks of life," Matthew Reed, chief executive of The Children's Society, said.
"Failure to make sure that benefit rates at the very least reflect rises in the cost of living will deepen inequality and increase poverty."
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