ED Balls has accused the UK Government of "driving people to the edge of despair" after a woman who committed suicide left a note blaming the so-called bedroom tax for her death.

The Shadow Chancellor, while refusing to comment on the specific case of grandmother Stephanie Bottrill, said many people were suffering "terrible trauma" due to the controversial policy, which the UK Government calls the spare room subsidy and insists is fair.

Introduced last month, it means benefits are deducted from social housing tenants of working age who are found to have more bedrooms than they need.

However, Mr Balls said: "If you are living in a home which has been adapted to deal with your blindness, your disability, if you have a bedroom which is there so that your child can come at the weekends because of a custody arrangement and you're told you are either going to be a lot worse off or you've got to give up that special adaptation and access to your child, it puts people in the most terrible stress. Two third of people affected by the bedroom tax are disabled."

Ms Bottrill's family said the 53-year-old from Solihull near Birmingham agonised about how she would afford the £20 extra a week for the two spare bedrooms in her home.

She died in the early hours of May 4 after being hit by a lorry on the M6 motorway.

Days before her death, Ms Bottrill told neighbours she could not afford to live any more. In a letter to her son Steven, 27, she said: "Don't blame yourself for me ending my life. The only people to blame are the Government."

Mr Bottrill said: "She was fine before the bedroom tax. It was dreamt up in London by people in offices and big houses. They have no idea the effect it has on people like my mum."

Mr Balls urged ministers to "stand back from the rhetoric" on welfare reform and look at the impact of their policies on the less well-off in society. "I'm for tough welfare reform but not hitting the most vulnerable and the disabled," he said.

Insisting the bedroom tax was unfair, the Shadow Chancellor said: "There's no doubt that this policy is driving people to the edge of despair in their many thousands across the country and I do think that David Cameron, George Osborne and Iain Duncan Smith should stand back from the rhetoric, which is always a little bit nasty and a little bit divisive, and say – 'what are we actually doing here?'."