Tories give benefits their best mail-shot

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Hundreds of thousands of homes are to be sent Conservative Party letters warning parents that, if Labour gets into office, they lose pounds 10.80 a week in child benefit.

Tory Central Office will use computer databanks to identify homes with 16-to-18-year- olds in full-time education, whose entitlement to child benefit is under "review" by Labour.

One Labour source said the Tory propaganda drive would speed up its review, which is under attack also within the Labour Party. Another source, close to Gordon Brown, the shadow Chancellor, said the results of the review would probably be published within the next 10 days, but denied that this had anything to do with Tory pressure.

For this age group, the future of child benefit - not paid to the parents of young people who leave school at 16, or to households receiving other benefit - is being discussed by Mr Brown; David Blunkett, Labour's spokesman on education and employmen; and Chris Smith, its social security spokesman.

A spokesman for Mr Brown said all three had been surprised by how unfair the existing system was. Mr Brown's intention is to transfer some of the subsidy from the taxpayer to the better off, and increase incentives for the least advantaged teenagers to stay in education or training.

"You can safely assume that the parents of pupils at Eton are hardly in need of child benefit," the spokesman said, implying that some form of parental means test would form part of Labour's plan. But the complex interaction of child benefit, student grants and loans, and welfare benefits, had delayed the the review process, he said.

Mr Blunkett has proposed an education allowance which could be paid to young people, while Mr Smith is arguing for the allowance to be given to the mother for upkeep, as with existing child benefit.

Ministers believe Labour's "pre-manifesto", published last week, ducked the issue because the three could not resolve their differences. That was denied yesterday, but a senior Labour source said there was advantage for Labour in speeding up the review to avoid the Tories' "shameless opportunism".

An unexpected result of the furore has been a Tory promise to preserve universal child benefit.