NORTH-EAST MPs and charities last night warned the region will be hit hard by the Prime Minister’s plans for a major welfare crackdown that would see thousands of young people stripped of housing benefit.

David Cameron’s proposals include scrapping £1.8bn paid to 380,000 under-25s, forcing them to live with their parents for longer.

His plans will be a further blow for the region’s young people, emerging only days after figures were published by the Trades Union Congress claiming the North-East has seen a 1,034 per cent rise in youth unemployment over the past 12 years.

The proposed measures are expected to be discussed when Mr Cameron delivers a keynote speech on welfare this week.

Commenting in a national newspaper at the weekend, he said: “We are spending nearly £2bn on housing benefit for under 25s – a fortune.

“We need a bigger debate about welfare and what we expect of people.

“The system currently sends the signal you are better off not working or working less.”

But homeless charity Shelter last night said his proposals could leave more people on the street, including in the North-East and North Yorkshire, where nearly 300,000 people rely on housing benefits.

Chief executive Campbell Robb said: “Many young people simply don’t have family and friends to fall back on if they lose their job, and rely on housing benefit to keep a roof over their head.

“At a time when many young people are facing significant difficulties in finding work, these proposals would leave thousands with nowhere else to go.

“They would also present serious problems for vulnerable young people, for example care leavers and those who have experienced family breakdown.

“It’s outrageous that the Government is considering undermining the housing safety net yet again. Sadly, it seems inevitable that we will see an increase in homelessness as a result.”

Sedgefield MP Phil Wilson said: “Some young people will be happy to stay with mum and dad or have that option, but many don’t.

“People who’ve moved out to go to university to get an education, those who want to live away from home and be independent but find it virtually impossible to buy a house will be penalised. There is little social housing so they go into privately rented housing and need that support.”

Mr Cameron’s other proposals include stopping the £70-a-week unemployment payment for individuals who are judged to be not trying hard enough to find work, and forcing a hard core of unemployed people to do community work after two years, or lose all their benefits.

Durham county councillor Morris Nicholls, cabinet member for adult services including welfare rights, said: “The welfare reforms are already going to cause problems with the most vulnerable people in society, in areas already struggling with deprivation.

“We are working terrifically hard to cope with cuts but when this comes in some people will have nowhere to turn.”

Unconfirmed reports yesterday also suggested the Government is considering regional rates for all benefits, linking payments to the cost of living in each area.

North-West Durham MP Pat Glass said this would take money out of the local economy.

“It will push people who are poor and make them poorer,” she said.

Shadow Work and Pensions Secretary Liam Byrne described the proposals as “hazy and half-baked”.

He said: “Many young families with their first foot on the career ladder will be knocked off if help with their rent is taken away. And young families that want to work won’t be able to move where the jobs are.

“The way to get the spiralling benefits bill down is start getting young people and young families back to work.

“I’m afraid this is another smokescreen from an out-oftouch Prime Minister whos now put our country back into a double dip recession, forced up youth unemployment to over a million and is doing nothing to fix the unfolding chaos at the DWP.”