Caritas Social Action Network will monitor the effects of the welfare reforms on the most vulnerable in society.
The social arm of the Catholic Church is going to be collecting statistics and real-life case studies of those who are impacted by the benefit changes.
The findings will be made public and presented to the government in April 2014.
CSAN is concerned about the impact of the welfare reforms on low-income families, unemployed people and children.
Key indicators include the number of individuals seeking help with debt, housing needs, food costs, basic utilities, mental health difficulties and social isolation.
CSAN is formed of 41 member charities including those that work with refugees, prisoners, the elderly, disabled people and the homeless.
Its Public Affairs Officer Liam Allmark tells Premier why they decided to launch the watchdog:
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