In a fresh setback to her attempts to plug the hole in Britain's budget, Rachel Reeves has been informed that cutting pensioner winter fuel payments could result in hundreds of millions less being saved than projected.

A plan to crack down on non-dom tax status is already being re-examined in part by the chancellor and her Treasury team due to worries that it might not generate any revenue.

The Observer has seen information, though, that casts doubt on the estimated £1.4 billion in savings from her very contentious reduction in winter heating payments.In order to defend the cut, which was anticipated to take money away from over 10 million seniors in England and Wales, Reeves has had to mount a valiant last-minute campaign.

This winter, the payment will only be made to people who are currently receiving pension credit. Last week, the chancellor assured the Labour conference that she would not avoid making difficult choices in order to restore the public finances. A union motion was later lost by the party leadership.

But a new analysis suggests that a surge in claims for pension credit since the cut was announced means that any savings could be significantly lower than the Treasury had anticipated. In just eight weeks, applications have increased by 152%.

Analysis based on official government data suggests there have already been 45,000 extra claims for pension credit since the measure was revealed.

Research from Policy in Practice, a consultancy working with local authorities to alert eligible pensioners of their rights to financial support, suggests that the extra amount the Treasury had expected to spend on pension credit could be hit as soon as this week.

On current trends, the analysis suggests there could be 158,000 more claims than anticipated by the pension credit deadline in late December, costing an additional £246m.

However, because claiming pension credit also opens up a series of other benefits for those claimants, the total costs could be up to £700m more than expected.

Any fall in the savings from the winter fuel cut will make Reeves’s task even harder before the budget on 30 October, already expected to contain a series of politically unpalatable decisions deemed necessary to raise cash.

“It’s great news that more pensioners are getting the financial support they need,” said Deven Ghelani, director of Policy in Practice. “The increased income for some of the country’s poorest elderly citizens can have wider benefits, providing much needed relief during a cost of living crisis. We have seen unprecedented demand.“While this means the change is unlikely to save the Treasury as much money as it hoped, it has meant a life-changing boost in income for hundreds of thousands of pensioners living in poverty.”

A Treasury source said they did not recognise the figures. A government spokesperson said: “We want people to get the benefits they are entitled to, which is why the government is working hard to drive up pension credit uptake. We are committed to supporting pensioners – with millions set to see their state pension rise by £1,700 this parliament through our commitment to the triple lock.

“However, given the dire state of the public finances we have inherited, it’s right that we target support to those who need it most.”

Labour had hoped to raise a further £2.6bn over the course of a parliament by closing non-dom loopholes, including £1bn in the first year of the changes.

The news comes before a politically fraught budget that is set to define the early stages of the new Labour government. Treasury officials have been scrambling to find savings. Reeves has been clear that it will contain tax rises, while ruling out increases to the headline rates of income tax, national insurance and VAT.

Loopholes in inheritance tax, often exploited by the wealthy, are among the measures thought to be under consideration. Capping agricultural and business reliefs could also save £1.4bn a year. A Treasury spokesperson said they would not comment on speculation.

Reeves will seek to couch her statement as an investment budget, however. It may include a reworking of fiscal rules to allow more public borrowing, alongside measures to encourage more private financing of Britain’s ailing infrastructure.

Relaxing the way debt is measured, to take more account of the assets created for the state by public investment, has long been a popular idea with some economists. Reeves told Labour’s conference that it was “time the Treasury moved on from just counting the costs of investment in our economy to recognising the benefits too”.

The Tories will accuse her of violating a promise made during the election campaign not to alter budgetary policies if there is any change. The Institute for Fiscal Studies stated last week that it is "hard to avoid the suspicion that the government is attracted not by any theoretical advantages of a change in the debt rule, but rather by the fact that it would allow for significantly more borrowing for investment."

According to sources in the city, there was a desire to fund British initiatives such as building new hospitals, schools, and roads. However, investors want a new organisation to supervise a new round of public-private agreements in order to avoid the conflict, costly court battles, and negative publicity surrounding the private finance effort started by the New Labour government after 1997.