I don't really know how the middle-class view "snitching" (I'm assuming you can fill me in, here?), but it's a pretty low thing to do among those with my background/upbringing. Especially if you do it to make money/save yourself. So yeah, I can't imagine it will take off. generally a benefit cheat won't hang around with honest people, will they?
It's a shitty thing for the state to encourage.