The government made changes to Personal Independence Payments in 2017
A total of 1.6 million of the main disability benefit claims will be reviewed, with around 220,000 people expected to receive more money.
It comes after the DWP decided not to challenge a court ruling that said changes to PIP were unfair to people with mental health conditions.
The review could cost £3.7bn by 2023.
The minister for disabled people, Sarah Newton, said the DWP was embarking on a “complex exercise and of considerable scale.”
She added: “Whilst we will be working at pace to complete this exercise it is important that we get it right.”
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Ministers made changes to PIP in 2017 which limited the amount of support people with mental health conditions could receive.
As a result, people who were unable to travel independently on the grounds of psychological distress – as opposed to other conditions – were not entitled to the enhanced mobility rate of the benefit.
The government pressed ahead with the proposals, despite criticism from an independent tribunal in 2016.
But in December, a High Court judge ruled the alterations “blatantly discriminate” against people with psychiatric problems and were a breach of their human rights.
Last week, new Work and Pensions Secretary Esther McVey announced the government would not appeal against the judgement , despite not agreeing with certain aspects of it.
Shadow work and pensions secretary Sarah Abrahams said it was “shocking” that so many claims were having to be reviewed and expressed concern that a timetable for action was yet to be put forward.
“The government was wrong to cut PIP benefits in the first place, wrong to bring in the PIP regulations last year and it was wrong to repeatedly ignore the views of the courts,” she said.
Mark Atkinson, chief executive at disability charity Scope, said more had to be done to address all the issues with PIP.
“While it’s crucial that the government urgently identifies and pays the vast numbers of disabled people who lost out on this vital support, this will not address the root of the problem,” he said.
“The fundamentally flawed PIP assessment needs a radical overhaul so it accurately identifies the extra costs disabled people face.”
Philip Connolly, policy manager at Disability Rights UK, welcomed the review but expressed regret at “persistent failures” of the assessment process.
“Huge amounts of taxpayers’ money is being wasted on poor quality assessments which deny disabled people benefits that they qualify for.
“We urge all disabled people who are turned down for benefits they believe they should get to use the independent appeals process if their claim is turned down,” he said
With many thanks to: BBC England for the origional story