ALMOST all benefit claimants will be forced either to look for a job or prepare for work if they want to continue to receive state handouts, under a shake-up of the welfare state.

Single mothers of children as young as one and people registered unfit for work will be compelled to go on training courses and work experience or risk cuts to their benefits.

In an interview with The Sunday Times, James Purnell, the work and pensions secretary, said: “Virtually everyone will be doing something in return for their benefits.”

The welfare reform white paper, to be published this week, is set to provoke anger from rebel Labour MPs and campaign groups who believe such measures are unfair in a period of rising unemployment.

The conviction of Karen Matthews for kidnapping her daughter Shannon has shown the perverse consequences of the welfare system. Matthews, who had seven children, had never worked and was existing on £400 a week in benefits.

The government will also announce plans to:

- Reform housing benefit to ensure the jobless can no longer live in large houses courtesy of the taxpayer.

- Allow companies to bid for contracts to place the long-term unemployed in work.

- Introduce a medical testing regime for people on incapacity benefit.

- Impose US-style “work-fare” schemes forcing those who refuse to take jobs to work in return for benefits.

At the core of the reforms is the proposal to divide benefit claimants into three groups.

The first group is made up of unemployed people on jobseeker’s allowance. From 2010, single mothers whose youngest child is aged seven or over will be moved from income support to the allowance. Lone parents now remain on income support until their children reach 16.

The second group will include about 400,000 single parents whose youngest child is aged between one and six, and more than 2m people claiming incapacity benefit. These claimants will face job centre interviews before being forced to undertake training courses or unpaid work placements.

A third group, including seriously disabled people and mothers of young babies, will continue to receive “unconditional” benefits.

There is expected to be legislation next year detailing the powers to be given to benefits advisers to compel claimants to attend official interviews.

Those who fail to turn up could have their benefits cut. Under one proposal being considered, a first offence would result in a claimant losing £12, rising to £24 for a second offence. Repeat offenders could forfeit all their benefits for four weeks and would have only essential bills paid.

The basic rate of income support and jobseeker’s allowance is £60.50 a week.

Purnell said his scheme was “not about stigmatising anybody”.

He said sanctions would be a last resort and the thrust of the reforms was to provide “personalised advice”.

Purnell sought to reassure parents of young children that they would be given assistance finding childcare. “The conditionality would be very different for a one-year-old compared to a six-year-old,” he said.

The new approach would make women like Matthews work rather than rely on welfare, he said.

Terry Rooney, the Labour chairman of the work and pensions select committee, warned that Purnell’s plan would prompt a backbench rebellion when it was debated in the Commons.

“This will lead to a bureaucratic nightmare with tens of thousands of people being called in for interview and then being sent home again,” he said.

“The key question on lone parents is whether childcare is available. In most cases, it is not.”

The Conservatives expressed doubts about the clampdown on lone parents. Chris Grayling, the shadow work and pensions secretary, said: “I don’t think these measures will actually work. Britain urgently needs real welfare reform to end the entitlement culture.”

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