Councils are having to top up discretionary housing payments to assist people who need exemption from the bedroom tax because Government is not providing enough money, Labour has claimed.

Shadow work and pensions secretary Rachel Reeves said the Department for Work and Pensions had told councils additional money would not be available this year if they spend all of their initial allocation.

Discretionary housing payments are funded by the Government to help people who cannot move to avoid the charge, which ministers describe as a spare room subsidy, and who need the extra bedroom.

The spare room subsidy or bedroom tax has been a long-running sore between the Government and Labour. It deducts money from housing benefit where a household has more bedrooms than residents, with some exemptions.

Labour has pledged to repeal the measure if it wins in May and has tabled an Opposition Day debate in the Commons to force a renewed debate and vote on the subject.

Ms Reeves said: " If you take Leeds where I am an MP, Leeds received £1.9 million in discretionary housing payment in 2013/14 but they spent £2.27 million and the Government made up that shortfall .

"But in 2014/15, Leeds City Council have been given £2.05 million and they have been told there is no option to apply for more. Leeds City Council have put in £0.35 million from their own money but spending to date has been forecast to exceed what they have set aside even including that extra money.

"The point about discretionary housing payments is there is not enough money to cover all the cases and city councils across the country are having to use their own money to make up the shortfall from the Government.

"Of course, by its nature discretionary housing payment is just that - discretionary. You only find out on a year by year basis whether you receive the money.

"So people who are getting it have no certainty they are going to be able to stay in their house next year or the year after either."

Welfare Minister Mark Harper intervened and said: "One of the things we specifically did in the discretionary housing payment guidance is specifically make provision for councils to make longer term awards where it is going to take someone longer to adjust to the policy.

"The Chancellor laid out extra money for discretionary housing payment for next financial year in order to give councils financial certainty."

Ms Reeves continued: "There are people applying for discretionary housing payment that are just not getting it."

The shadow minister concluded by condemning a "cruel and unfair tax" and demanding it be scrapped immediately.

In his speech, Mr Harper said: "Today of all days, Labour would rather talk about anything but the positive jobs figures we are seeking - more people in work than ever before, up 590,000 on the year, and up 1.7 million since 2010.

"Labour have chosen their Opposition Day to have a debate that is contrived to scare people instead of welcoming the record employment figures."

Mr Harper accused the Labour spokeswoman of making a partial case in her speech and politicising individual cases.

The minister added that there were one- and two-bedroom homes across the social housing sector and told MPs that local authorities and housing associations were now matching new building work to the need for smaller properties.

He said: "77% of homes approved under the new affordable housing scheme are one- and two-bedroom homes - up from 68% in the last round."

Mr Harper said Labour had increased welfare spending by 60% while in office and rejected every cut implemented by the Coalition.

"This policy restores fairness," Mr Harper said, "it brings the social sector into line with a policy Labour advocated for the private rented sector and it ends the unfairness of 820,000 spare rooms paid for by taxpayers when there are 250,000 people living in overcrowded homes and 1.7 million on waiting lists when this reform was implemented."

Mr Harper said the measure had saved £830 million to date with savings forecast to increase in future years.

"Abolishing this reform costs over £500 million a year," he said.

"You made an absolute pledge to do it but you have absolutely no idea how you are going to fund this pledge."

Mr Harper said: "This debate is a manoeuvre to avoid talking about our successful long-term economic plan with the deficit halved by the end of the year, meeting the welfare cap commitment in every year of the forecast, welfare spending falling as a proportion of GDP and reforms set to save nearly £50 billion over this Parliament, restoring hard-won security, hope and aspiration to families across Britain.

"Listening to the party opposite, I've only one thing to say - they need more time in Opposition to work out why the public doesn't believe they are fit for office."

Labour chairwoman of the Work and Pensions Select Committee Dame Anne Begg said she would like to see the "bedroom tax" "scrapped as soon as possible".

The committee, she said, had made some very important recommendations about how the worst effects of "this pernicious policy" could be mitigated through exempting particular groups such as carers and disabled people who needed extra room or those in specially adapted accommodation.

She said: "I can't see why the Government persists in turning its face against these absolutely sensible proposals ... they keep arguing that it's all right because they get discretionary housing payment, but discretionary housing payments aren't permanent and what they need is some kind of permanent adjustment."

The breadth of the numbers involved of those caught by the "bedroom tax" was, she said, "quite staggering" across the country.

Tory Kwasi Kwarteng (Spelthorne) argued that there was "a lot of scaremongering, a lot of wild words", but little actual attention to the facts.

He said: "The Government introduced the spare room subsidy simply to equalise what was going on in the private sector."

Speaking about the economic context, he argued it was the "financial management of the madhouse" not to have a look at welfare expenditure.

He added: "There's a wide acknowledgement in the public that these reforms, difficult though they are, are absolutely crucial to trying to reduce the deficit and get this country back to some form of sanity in the conduct of its economy."

Labour's Yvonne Fovargue (Makerfield) questioned the wisdom of moving people every time their circumstances changed, arguing that debt, eviction and widespread misery were the results of the Government's reform.

She said: "Kindly commentators may say that the bedroom tax is simply an example of a short-sighted, ill thought out, thorough administrative mess up, but actually it's worse than that. It's cruel, it's nasty and it's the cause of a great deal of misery and hardship.

"It springs from the same policy mindset as a belief that food banks are somehow an acceptable part of the social fabric of the 21st century."

The 'bedroom tax' she argued had "played its part in pushing people towards food banks", adding: "All it's done (is) to make poor people more stressed and desperate, living with a constant uncertainty of discretionary housing payments."

She added: "I believe that the human cost of this policy doesn't justify any savings that may have been made."

Lib Dem Andrew George (St Ives), a vocal opponent of the policy, said there were many circumstances where apparent under occupancy was for good reason.

He said: "In my view the fundamental moral point is that the poor are just as entitled to a stable family home as the better off."

He added: "The Conservatives do have form when it comes to spending public money on the under occupany of residential property because after all the last time they were in Government on their own they introduced a council tax discount for second homes, hundreds of millions of pounds of taxpayers' money was spent every year subsidising the wealthy to have their second homes when there were thousands of local families who couldn't afford their first and this defines the Conservatives' approach.

"They reward the wealthy when they under occupy their second home and they penalise the poor when they under occupy their council home."

He urged MPs to seek political consensus instead of "using the victims of this policy to score party political points".

Labour's Geraint Davies (Swansea West) accused the Tories of "ripping food out of the mouths of the poorest" so people are forced to rely on food banks.

Eilidh Whiteford, SNP MP for Banff Buchan, said the Government was "scapegoating" the most vulnerable for the problems in housing.

Disabled people were on the "front line of the austerity cuts", she added.

Labour's Michael Connarty (Linlithgow and East Falkirk) said Mr Harper's speech lacked compassion, something he suggested had rubbed off on him from Work and Pensions Secretary Iain Duncan Smith.

He called the bedroom tax "punitive" and claimed it was designed to be so.

His colleague Sheila Gilmore (Edinburgh East) dismissed the Government's argument that the policy brings the social sector into line with what Labour previously advocated for the private rented sector.

She said they were not the same and added: "If this was about people being able to move and then ... they refused a reasonable move, that might be a different matter. That would be comparable."

Labour's Lilian Greenwood (Nottingham South) said there were many reasons why people needed a spare room, such as a single parent seeing their child at weekends or somebody with a disabled partner.

She accused the Government of balancing the books on the backs of poor and vulnerable people.

"It is about taking money from the households least able to afford it," she concluded, while providing tax cuts for the rich.

Shadow work and pensions minister Kate Green said the bedroom tax was not achieving what ministers said it would, namely deal with under-occupancy.

She told MPs that only 5.9% of affected households had since downsized.

The Government defeated the Labour motion by a reduced majority of 32, winning the vote 298 to 266. A Government amendment was then carried 300 to 262, majority 38.