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Benefit claimants are being reassessed and moved from incapacity benefit to employment support allowance.
The Citizens Advice Bureau (CAB) and Shoreline Housing Partnership said 120 people a month were losing money by not notifying the authorities of change.
The Department for Work and Pensions (DWP) said people had to inform local authorities if they were transferred.
Those being reassessed are sent letters informing them of the changes to their entitlements and told they must tell their local council. Read More: