Unions and poverty campaigners have reacted with anger to plans to privatise much of the benefits system and to require lone parents with children over 12 to seek work.

Tony Blair and Gordon Brown both supported the recommendations of the independent Freud Report, which proposed ways to get 1.3 million long term benefit claimants — including 300,000 lone parents — into work.

The Government believes that the benefits system needs a radical overhaul to prevent the welfare bill, currently £60 billion a year, from becoming unaffordable, and also to reduce child poverty.

Mr Blair said: “If we want to be able to afford our welfare state in the future, not just paying people who cannot work a better level of benefit, but in particular affording a strong basic state pension for the increasing number of people of retirement age, we have got to get even more people off benefit and into work.”

However, campaign groups working with unemployed people attacked the plans as mistaken and misguided, while unions said that it was a slap in the face for Jobcentre workers and threatened industrial action.

Chris Pond, chief executive of One Parent Families, and a former Labour MP, said: “Taking a strong-arm approach to these parents would be wholly counter-productive, intensifying the pressures on them while deterring those lone parents who are work-ready from coming forward.”

Colette Marshall, director of Save the Children, said: “The Government’s approach is misguided.”

The reforms are also likely to meet strong opposition within the Labour party.

Times Recommends

• 5 Christmas romance confessions
• Has champagne lost its sparkle?
• Your tailor-made Christmas