Lilley wants 'jobseekers, not job-shy': The White Paper

White Paper: main points

Unemployment benefit cut from 12 to 6 months

Claimant obliged to sign 'Jobseeker's Agreement'

Advisers can direct claimants to improve their chances of a job

'Back-to-work bonus' if claimant works part-time

Details of the Government's plans to replace unemployment benefit with a six-month Jobseeker's Allowance, set out in a government White Paper yesterday, were greeted with fierce criticism.

Donald Dewar, shadow social security secretary, described the plans to sweep away unemployment benefit, which lasts one year, as a breach of the contract between national insurance payers and the state of a 'quite remarkable nature'.

From April 1996 the new benefit would be payable for six months on the basis of claimants' NI contributions. It would then become means- tested like income support. Those with savings of pounds 8,000 - including savings accumulated from a redundancy payment - would receive nothing.

Peter Lilley, Secretary of State for Social Security, said that the planned allowance should 'help the jobseeker and motivate the job-shy'.

A duty on unemployed people to sign an individually tailored Jobseeker's Agreement is at the heart of the planned scheme, which would also require the jobless to be available for 'any work which they can reasonably be expected to do' for at least 40 hours a week. Jobseekers would be expected to 'broaden their horizons' after 13 weeks, Mr Lilley said.

Whitehall sources insisted that this would not mean jobless white-collar managers being asked to do production- line jobs or risk losing benefit, while claimants would be entitled to take a job on trial after three months' unemployment and leave it after four weeks.

Employment Service advisers would be given powers to direct claimants to improve their prospects with jobseeking skills or motivation, or taking steps to 'present themselves acceptably' to an employer. Those refusing to attend or complete mandatory courses would face tough sanctions.

Michael Portillo, Secretary of State for Employment and co-author of the paper, told a news conference people who had been out of work for a long time would be 'required perhaps to turn up on a training course, possibly to turn up and do a job of work which may be of value to the community'.

As Mr Portillo highlighted eventual benefit savings of pounds 200m a year, Labour and the Liberal Democrats contested a claim by Mr Lilley that the plan would 'help Britain generate even more jobs'. Harriet Harman, shadow employment secretary, said the new limit would make a quarter of a million people worse off.

Alan Jinkinson, general secretary of Unison, Britain's biggest union, said: 'Far from creating genuine jobs, the squalid proposals, styled on the failed US workfare scheme, will generate a sweat-shop society.'

Barrage of criticism, page 8 Leading article, page 17