84,000 single parents will be contacted by Centrelink to let them know that they should not cut up their pensioner concession cards.
The Federal Government agency is now telling them they can still use their old cards to receive a range of concessions on utility bills, transport, car registration and medicine.
Human Services Minister Kim Carr said he had spoken to his departmental secretary about correcting the misinformation.
"I have asked the department to contact all the people who are affected to explain again that the concessions will continue," he told ABC Radio on Monday.
The Government already was under pressure over its decision to move tens of thousands of single parents from the Parenting Payment to the lower Newstart Allowance, once their youngest child turned eight.
Senator Carr defended Centrelink saying they dealt with about seven million Australians a year, and handled 56 million phone calls each year.
"In any one day there are probably some 135,000 face-to-face contacts.
"There are occasions when things go wrong. This is one of those occasions."
The recently formed Single Parent Action Group is planning protests around the country when Federal Parliament resumes on 5th February, including a march from Old Parliament House to new Parliament House in Canberra.
A spokeswoman for the group, said the rally aimed to show it was unacceptable to force people to live under the poverty line while raising children.
Prime Minister Julia Gillard has previously acknowledged it would be ''incredibly tough'' to live on $35 a day but said the government's priority was to create jobs.
Mr Rudd last week called on the government to ''show a bit of heart and do more'' to help Australians struggling on Newstart.
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