Think-tank's social policy proposal

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PA

A youth allowance for 18 to 21-year-olds and a higher rate of Jobseekers' Allowance for those with a record of employment are among the key proposals of a wide-ranging report on social policy unveiled by the centre-left Institute for Public Policy Research think-tank.

The IPPR Condition of Britain report is understood to have informed Ed Miliband's thinking as the Labour leader drew up his plans for reform of welfare.

It argued for a return to the "contributory principle" in welfare, with jobless people who have paid National Insurance over the years being rewarded with higher benefit rates and access to support for mortgage interest.

Under the report's recommendations, a reconstituted and independent National Insurance Fund would be given the job of restoring the link between contributions and entitlements and ensuring that contribution rates are high enough to pay for benefits over the long term.

Those aged 18-21 should be guaranteed access to education, training or help to find work - with compulsory work experience after six months - said the report. Those in education or looking for work should be entitled to a youth allowance.

The 270-page report, drawn up over 18 months, also called for reforms to cut the housing benefit bill by devolving capital budgets to towns and cities and allowing councils to retain and reinvest a share of any savings, as part of a drive to decentralise power away from Whitehall.

IPPR director Nick Pearce said: "We need new strategies for social renewal in Britain for the tough economic times we live in.

"These must be based on a decentralisation of power over major areas of policy out of Whitehall, a rebuilding of reciprocity and the contributory principle in the welfare state, and investment in shared institutions, like the NHS and Children's Centres, rather than spending channelled through tax reliefs or credits.

"Our proposals are fully costed and paid for through spending switches and tax reforms. They chart a path towards a stronger, more socially equal Britain in the 2020s."

Among the report's 28 recommendations are:

:: A month off for fathers when their child is born, paid at least the minimum wage

:: Guaranteed affordable full-time child care for one to four-year-olds, with 15 hours a week free care for all two to four-year-olds

:: Child benefit to rise with prices for under fives but frozen for older children

:: A Work Programme focused on the long-term unemployed and people recovering from a health condition

:: An independent Affordable Credit Trust to endow local affordable lenders as alternatives to payday lenders

:: New powers for towns and cities to bring forward land for development

:: An entitlement to "restorative justice" to give a voice to victims of crime and anti-social behaviour

:: Neighbourhood justice panels in every area to mobilise local volunteers to help tackle low-level crime and anti-social behaviour

:: An entitlement to means-tested support for older people with "moderate" care needs

:: An independent review to consider how the National Insurance system could protect people from high care costs in old age

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