Blair warns angry MPs that he won't bend on welfare reform

Tony Blair appealed to backbench MPs for unity yesterday as anger persisted over planned benefit cuts. But he shows no sign of applying the brakes on welfare reform.

Fran Abrams and Colin Brown report on Labour's tough pre-Christmas

messages.

The Prime Minister will listen. But he is not contrite about cutting benefits and he won't buckle before the Labour rebels. Speaking to the Parliamentary Labour Party, he told it to focus on the "big picture" and not to be distracted from electoral promises, including modernisation of the welfare state.

``We could not have been clearer about our determination to modernise the welfare state ... [and] to get spending on social and economic failure down so that could get spending on education up,'' he said. Then he warned of even less popular decisions to come. That on lone parents ``would almost certainly not be the hardest decision or issue'' Labour would have to face.

As for the critics and rebels: "I have listened to criticism in recent days. There has to be room in any party for criticism, for conscience, for dissent."

He went on, however: "Constructive criticism is one thing. But it should never be made in such a way that it merely provides gifts to our political enemies, or repeats their propaganda about broken promises when we have broken none, or accuses us of dismantling the welfare state when it is this party that built the welfare state and this government that will save the welfare state," he said.

That did not calm all the 47 rebels who voted against the Government on lone-parent benefit last week, though parts of the speech provoked both laughter and applause.

Afterwards party officials promised new efforts to ensure that backbenchers' concerns were heard. But the protesters said that their attempts to voice their feelings privately had brought no concessions.

In future, a spokesman said, there could be an "early warning system" to try to avert clashes, and perhaps more discussion of issues at a regional level within the party.

MPs had been told not to comment on the meeting, but some said afterwards that they had been neither mollified nor angered by Mr Blair's speech.

Tony Benn, MP for Chesterfield, said: "There is very real anxiety among people who voted with the Government as well as among those who voted against it." Another of the dissenters said the leadership was "far from out of the woods ... It must be very plain to everybody, and if it is not plain to the leadership, by Christ they are in for a shock".

Meanwhile, a more positive example of the Blair strategy was unveiled when Andrew Smith, the employment minister, promised that plans to "green" the nation's rundown inner cities will also "transform" the job prospects of thousands of youngsters.

The multi-billion pound Welfare-to-Work scheme aims to help those who quit the dole and is paid for with pounds 3.5bn from the windfall tax on the privatised utilities. Tree planting,landscaping and building work to improve the environment will be among the projects available to young people.

Such initiatives will please Labour MPs but will not calm the benefits row. Cabinet ministers have received protest letters from Labour Party members resigning over the cuts in lone-parent benefits.

Gordon Brown was challenged over his agenda yesterday at the Commons Treasury Select Committee. But veteran left-winger Brian Sedgemore was told by the Chancellor that there would be no let-up in the strategy, which he denied was "cuts-driven".

Support for the Government and Tony Blair has dropped, but Labour still has a 29-point lead over the Tories, according to a poll in today's Times. Support for Labour is at 55 per cent, down 1 point from last month, while Conservative support is up 2 points to 26 per cent.