I think that FSM should remain for people who need them. The problem is how do you define 'need'? Clearly some people are much worse off than others, both the working poor as well as some people on benefits. The people who genuinely need the help should get it.
However, I disagree hugely with some of the things people have posted on here about their financial situation and the things people use benefits for.
Baroque - you say openly that you smoke. You go on holiday. You even manage to save some money. You have also posted elsewhere on MN that you have recently got a pet. It doesn't sound like you are struggling to me and in need of benefits to provide you with the basics you need. I am sorry to single you out, but you have said that you claim benefits and also FSM's so am using it as an example.
I gave up smoking 4 years ago because I could no longer afford it. I haven't had a holiday for 3 years. We almost went last year (4 days in Cornwall), however after working through our finances we couldn't even afford that. We literally don't have a spare £10 a month left after all bills have been paid. We both work. My dc's are clothed in second hand clothes, almost everything in our house is falling apart and cannot afford to be replaced. All meals are planned and food we buy is all budget range. Saving money would be an absolute luxury for us, something we can only dream of ever being in the position to do. Why? Why can people on benefits afford to do all this, yet we work full time and can't?
And now you have taken on a pet that also costs extra to insure/feed etc 
Surely this is evidence enough that you do not need all the benefits that you get. Benefits are there for families to live on in extreme hardship. Not for people to smoke/save/holiday/have pets. If you are able to save even a penny and buy cigarattes then you are given more than emergency money to live basically on e.g. food/heating/utilities etc.
Depite this I have no grudge or issue whatsoever with anybody claiming benefits to use as they should be used. If people genuinely need them, then they should be given them. What I do resent is having to live like we do and struggle to get by month to month and then hear of people who have a better lifestyle than us on when they are on benefits.
This is why the country is in a mess - people claiming things that they obviously don't really need. I know much of it is the governments fault for handing it out, but at the same time individuals are also claiming and taking it. Until this stops then the people suffering real hardship will all suffer.
It isn't all the governments fault, a lot of it is I agree, but now they are having to do something to reduce the debt we have and prevent the country going totally into decline. Its just easier for people to blame the government rather than realise they have had quite a decent lifestyle courtesy of them and taxpayers. Benefits can be reduced in some cases, (and I do only mean in some cases, not all) people don't need everything they get as is demonstrated above.
I am not a Tory voter and disagree with a lot that they propose, however I do think some people need to take some responsibility.
Again, I do apologise for using your posts as an example, I am sure there are many others doing the same, but your post stood out to me as an example of the difference in your lifestyle and mine.