Stresses Job Incentives Instead of Guaranteed Benefits : Democrats Offer Welfare Overhaul Plan

House Democratic leaders Thursday introduced a welfare overhaul plan that they said would offer incentives for training and obtaining jobs in place of the current program that makes beneficiaries dependent on federal payments.

Among the features of the proposal are a guarantee that all welfare recipients would receive benefits equal to at least 15% of their state’s median income and requirements that many beneficiaries participate in education and job training programs.

“There will be sanctions against recipients who fail to cooperate with employability efforts and a financial incentive for those who do cooperate,” House Speaker Jim Wright (D-Tex.) said.

The plan would offer welfare recipients “a chance, and not only a check,” Rep. Sander M. Levin (D-Mich.), a key backer of the proposal, added.

The legislation, which was written by Rep. Harold E. Ford (D-Tenn.), is expected to reach the House floor in late May. The Senate is expected to produce its own version in mid-April.

Top Domestic Priority

President Reagan and congressional leaders have stated that major revision of the nation’s welfare system is a top domestic priority this year, saying that their goal is to break a cycle that makes it difficult for recipients to free themselves from dependency on welfare.

Both advocate a system that would require welfare recipients to agree to job training, rather than the present plan of guaranteeing benefits to anyone whose income is below a certain level. The White House would give states more freedom to experiment and to cut through red tape to get people off welfare rolls.

However, the President and Congress are sharply divided over the approach that will most efficiently accomplish that end.

Although the Congressional Budget Office has not yet developed an accurate cost estimate for Ford’s plan, it is certain to be much more expensive than the Administration’s proposal and is therefore likely to face strong opposition.

Coverage of Training Costs

The proposal that will go before the House would require the federal government to pay training costs and would provide federal benefits such as Medicaid coverage and child care costs for those who have been trained and are in the process of finding work.

The requirement that benefits be at least 15% of a state’s median income would have no effect in California, which already provides almost 28% of the median income. However, it would significantly increase costs for states such as Alabama and Mississippi, which guarantee less than 8% of median income.

Although Ford acknowledged that his proposal would be expensive in the short run--costing as much as $850 million in the first year--he insisted that it would save the government money within a few years.

“Over time, these families will be independent of the welfare system,” he said.

Although Ford’s plan would require most beneficiaries to sign contracts agreeing to undergo training and subsequently seek jobs, it would exempt some, including parents of small children, the elderly and the ill.