The government's flagship benefit reform has "serious design flaws" and has "veered off track" because of cost-cutting, a think tank has warned.
The Resolution Foundation said Universal Credit could leave 2.5 million families worse off, some by more than £3,000 a year.
It comes as the government announces a further expansion of the scheme.
Welfare Secretary Stephen Crabb said the payment was "transforming welfare" and getting people into work faster.