A leading Government department has been criticised for making wrong decisions on the ability of benefit claimants to work, at "considerable cost" to the taxpayer.
The Department for Work and Pensions (DWP) was causing "misery and hardship" to claimants, it was warned.
The Public Accounts Committee (PAC) said there had been much criticism of Atos, the firm contracted to conduct so-called work capability assessments (WCA), but it warned that most of the problems lay with the department.
The WCA tests were introduced in 2008 to assess entitlement to Employment and Support Allowance. Atos was paid £112.4 million to carry out 738,000 assessments in 2011/12.
The MPs' report said: "The Work Capability Assessment process is designed to support a fair and objective decision by the department about whether a claimant is fit for work, but in far too many cases the department is getting these decisions wrong at considerable cost to both the taxpayer and the claimant.
"The department's decisions were overturned in 38% of appeals, casting doubt on the accuracy of its decision-making. Poor decision-making causes claimants considerable distress, and the position appears to be getting worse, with Citizens Advice reporting an 83% increase in the number of people asking for support on appeals in the last year alone."
Margaret Hodge, who chairs the committee, said the DWP was getting "far too many" decisions wrong on claimants' ability to work. "This poor decision-making is damaging public confidence and generating a lot of criticism of the department's contractor for medical assessments, Atos Healthcare - but most of the problems lie firmly within the DWP. The department is too often just accepting what Atos tells it. It seems reluctant to challenge the contractor."
Employment minister Mark Hoban said: "This report completely fails to recognise the considerable improvements we have made to the Work Capability Assessment since coming to power in 2010, having inherited a system from the last government that was not fit for purpose.
"Rather than scaremongering and driving down the reputation of the WCA, critics might like to acknowledge the fact that independent reviews have found no fundamental reforms are needed to the current process because of changes we're making. This coalition Government is determined to help those who are found fit to work into employment, but those who aren't will still get comprehensive support."
Richard Hawkes, chief executive of the disability charity Scope, said the report provided more evidence that the fitness for work test was "broken", adding: "The Government has to act. Over the last year we have seen high levels of successful appeals, shocking undercover footage of Atos assessors and horror stories of people inappropriately found fit to work. Today we can add the Public Accounts Committee's finding that this debacle is a considerable cost to the taxpayer to the bulging dossier of evidence that the test is failing."