JOBLESS young people will be stripped of benefits if they refuse to go on training schemes, under tough new Labour plans.

Ed Miliband will announce today (Thursday) that a new “youth allowance” will be introduced for 18 to 21–year olds not in work or education, if his party wins power.

But only young people who are undertaking training will be eligible for the allowance which will also be means-tested – in a crackdown on those tempted by “a life on benefits”.

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Mr Miliband will criticise the “injustice” of the current system, because it denies support to young people who are doing more than 16 hours-a-week training or further education.

And he will say: “The perversity of the system means that the one thing we most discourage those young people from doing is getting the skills they need for a decent career.

“The system is telling them that they should sign on for benefits, not sign up for proper training.”

Around 100,000 young people – seven out of ten claiming Jobseeker’s Allowance (JSA) – have low skills, but are prevented by benefit rules from training while looking for jobs, he will say.

The plan is a centrepiece of a ‘Condition of Britain’ report put forward by the left-leaning IPPR think-tank, outlining 20 policy ideas that could feature in Labour's election manifesto.

Mr Miliband will also unveil plans to hike JSA by up to £30-a-week for people have “paid into the system” by working for many years.

This “contributory JSA” – harking back to the aims of the original welfare state – would be funded by making claimants wait longer to become eligible for the higher rate, perhaps five years.

And Mr Miliband also confirmed plans to allow local councils to negotiate lower rents with landlords through ‘bulk purchasing’ and keep some of the savings from lower housing benefit.