Labour defends benefit `cuts'

Labour leaders last night defended plans to remove child benefit from 16- to 18-year-olds after Peter Lilley, the Secretary of State for Social Security, said the move would "clobber" low-income families.

Mr Lilley said cutting child benefit for 16- to 18-year-olds would rob some families with one child in education of pounds 500 a year and discourage young people from staying in education. "It is not just middle classes who will suffer from Labour's plans," Mr Lilley said. "A quarter of 16- to 18-year-olds in education live in families on low-income related benefits."

Left-wing Labour MPs and the Child Poverty Action Group (CPAG) also expressed concern, but the CPAG welcomed the commitment of the shadow Chancellor Gordon Brown to keep child benefit for those under 16 as a universal payment.

Labour admitted there will be losers, but insisted that the released money would be targeted at lower-income families. A source said: "There will be losers but there will be large numbers of winners as well. We want to focus resources on people for whom the financial case for going into work is too great."

Sources close to Mr Brown, said it was crazy that parents with boys at Eton were able to collect pounds 10.80 a week in child benefit, when it was denied to families whose children had been forced to go out to work.

Ending child benefit for 16- to 18-year-olds would release pounds 700 million for spending on schemes to encourage people to stay on at school or college, Labour estimate.

The Independent has learned that Michael Heseltine, the deputy Prime Minister, has ordered a Government survey of training to be published to answer Labour's election campaign strategy on training and education.

Labour's strategy, outlined by the shadow Chancellor in a John Smith memorial lecture, could release pounds 9bn in further education money to encourage more people, particularly from low-income families, to take further education through a combination of targeted grants, loans, and benefits.