Smash hit

“In difficult times we have been able to and will continue to hold to a stable course, and I assure you that we will continue to take all necessary measures to ensure that in future we maintain our hard-won stability," he said.

“We will take no risks. There will be no irresponsible relaxation of pay discipline, no unfunded spending commitments, no unaffordable promises and no short-term giveaways. By definition, responsible government demands that stability will be our first priority - yesterday, today and tomorrow.”

Mr Hain is today set to announce reform of the so-called 16-hour rule, which restricts people over the age of 19 from claiming housing benefit if they study for more than 16 hours a week. Mr Denham is to announce a new “careers and advancement” service to help people to train whether in or out of work.

Mr Hain is to announce moves tomorrow to contract - and offer incentives to - the private sector and charities to play a central role in JobCentre Plus functions. Those signing on as unemployed will be asked to look at skills advice and training, which would be taken into account as part of their benefit entitlement, Mr Brown said.

Mr Brown said that there would be an “intensification” of compulsion but also greater incentives for taking part. Lone parents should train so they are ready to work when their children go to school.

He also promised a modernised incapacity benefit regime with help for those in need of education and training and medical help where mental health problems are an issue.

Mr Brown said: “If, in the old days, lack of jobs demanded priority action, in the new world it is lack of skills. So, as we prepare and equip ourselves for the future, many of the policies of the past are out of date, with no answers to be found in old dogmas - and long-term reforms changing the role of education and welfare - the responsibilities of the individual and government will have to intensify and be stepped up.”

Mr Brown said that the Government would continue to invest in major projects, such as the £16 billion Crossrail scheme. The Government would press ahead with the expansion of Heathrow and tomorrow set out plans to streamline the planning system, the Prime Minister said.

He repeated that new nuclear power stations “potentially” had a role to play in tackling climate change and improving energy security, and a final decision would be announced early next year.

On the environment, Britain was committed to reducing carbon emissions by at least 60 per cent by 2050.

Following recent disquiet about the scrapping of taper relief on Capital Gains Tax, Mr Brown said he would continue to “listen and discuss” business concerns about it.

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