The software will be tested in job centres later this year

So-called "voice-risk analysis software" will be used by council staff to help identify suspect claims.

It can detect minute changes in a caller's voice which give clues as to when they may be lying.

The technology is already used by the insurance industry to combat fraud and will be trialled by Harrow Council, in north London, from May.

It will be tested on housing and council tax benefit claims first, before being rolled out to job centres later in the year.

Announcing the pilot, Mr Hutton said: "This technology aims to tackle fraudsters while speeding up claims and improving customer service for the honest majority."

Further evidence

The BBC's business reporter John Moylan explained that the system first analyses the characteristics of a caller's "normal" voice to establish a benchmark.

This ensures it takes any natural variation, for example due to nerves or shyness, into account.

The software then looks for changes in voice tone and frequency and performs thousands of mathematical calculations to identify signs that someone could be lying.

Benefits staff can then ask for further evidence to support any suspicious claims.

Callers will hear a standard message before they speak alerting them that the technology is being used.

According to government figures, benefit fraud cost the UK economy about £0.7bn in 2005/06.

For the Conservatives, shadow work and pensions secretary Philip Hammond said Gordon Brown's obsession with a complex welfare regime was the real reason why so much was lost to fraudsters and cheats.

He said: "This government's reaction to every problem is yet more Big Brother technology. Given that £2.6bn worth of benefits were overpaid last year alone, it's disappointing that this re-heated lie detector initiative is the best it can come up with."