The amount of money the government lost through benefit fraud and error fell last year, the National Audit Office (NAO) has said.
Benefit fraud and error cost taxpayers £2.6bn last year
Total loss due to fraud and error at the Department for Work and Pensions (DWP) was £2.6bn during the 2004-2005 tax year.
In each of the previous three years, about £3bn had been lost.
The NAO said that the fall could be mainly explained by new accounting procedures adopted by the DWP.
Sir John Bourn, the auditor general, reported that the DWP had improved the accuracy of its benefit fraud and error calculation.
According to Sir John the DWP was "moving in the right direction" and welcomed "improved transparency" in its accounts.
"The Department for Work and Pensions' challenge in reducing the scale of fraud and error to an acceptable level remains a considerable one," Sir John cautioned.
In response, Edward Leigh MP, chairman of the Committee of Public Accounts, said that the view that fraud and error were falling had to be put into context.
"This looks like a significant reduction...This would be to ignore an important change in the department's methodology for estimating fraud and error overpayments - one result of which is that £0.7bn of Disability Living Allowance payments to people who were not entitled to them have been excluded from the global total of fraud and error," Mr Leigh said.