Millions of part-time workers face punitive loss of benefits

The group has warned of grim consequences if Con-Dem plans to replace a raft of benefits and welfare payments with a single "universal credit" go through.

The scheme caps all government assistance for families at £500 per week, and childless singles at £350.

But working people who earn less than £212.80 a week will only continue to receive payments if they can find 35 hours of paid employment every week.

Resolution policy analyst Matthew Pennycook and economist Matthew Whitaker said the scheme represented an "unprecedented change."

"We have estimated that under universal credit welfare conditionality will be extended to just under 1.2 million working individuals - people who have not previously had to interact with the apparatus of the state on such a basis."

They added that it was hard to see how people could meet the department's demands in the current economic crisis, with unemployment at 2.59mand underemployment at 1.4m.

TUC general secretary Brendan Barber said: "Record numbers of adults are having to settle for part-time posts because they can't get any additional hours, not because they are lazy. Why is the government looking to add to their misery by cutting vital support?"

A DWP spokesperson said: "Universal credit will help people increase their hours and see a clear financial gain in work, but no-one will lose out where caring responsibilities, illness or lack of jobs means full time work isn't possible for them.

"People who could work full-time but chose instead to have benefits top up their income should be encouraged to do more and we intend to run pilots to agree the best approach on this."