Politics 88 : May Back Cheaper Senate Overhaul Plan, Governors Told : Reagan Balks at House Welfare Bill

President Reagan would veto a $5.7-billion welfare-overhaul bill approved by the House last year, but he might sign a less expensive, less rigid version being considered in the Senate, White House Chief of Staff Howard H. Baker Jr. told the nation’s governors Monday.

In a meeting with the governors, Reagan sidestepped any comment on the $2.3-billion Senate measure, but he endorsed a similarly priced Republican proposal that already has been rejected in the House.

The welfare measure is one of the chief pieces of legislation before this session of Congress.

Massachusetts Gov. Michael S. Dukakis, a leading Democratic presidential candidate, said that the remarks made by Reagan and Baker disappointed a large bipartisan group of governors that has been pushing the more ambitious welfare plan.

Republican Gov. James R. Thompson of Illinois, identifying cost as the main sticking point, said: “I still hold out hope that, between the Administration and the Senate, we can get a bill.”

House Add-ons Noted

Baker told the governors, in Washington for their annual meeting, that welfare is a problem that “requires immediate attention.” Unfortunately, he said, the President’s own proposal “grew like Topsy” in the House, where “a vast increase” in benefit payments was added.

Baker, former Senate Republican leader, expressed hope that bipartisan negotiations on a proposal by Sen. Daniel Patrick Moynihan (D-N. Y.) would produce a bill that the President would support.

The governors gave a major boost to the drive for revision of the welfare system a year ago, when they unanimously endorsed a far-reaching plan to establish mandatory education and training programs for able-bodied welfare recipients.

Reagan backed that plan in concept but stopped short of agreeing to the governors’ suggestion that the federal government pay most of the first-year costs. He proposed instead a welfare package that would allow states to design their own reforms, using funds that would otherwise have been spent on current programs.

The Democratic-controlled House last November approved legislation that called for spending $5.7 billion over five years to establish a National Education, Training and Work program, called Network, to help welfare recipients get onto payrolls.

Programs for Employment

States would be required to provide high school and remedial education, skills training, on-the-job training, job placement and child-care services to people who moved into jobs from welfare.

That bill allows for higher federal matching payments to states that increased their welfare benefits.

Moynihan’s proposal would set up similar education and training programs but would cost $3.4 billion less. It would not increase benefits and would give the states more flexibility to retain programs that have been successful for them.

Reagan, sitting with the governors at a square-shaped formation of tables in the East Room of the White House, said that he supports the House GOP bill, which would cost about the same as Moynihan’s but would give the states even more freedom to run their own programs.

Also, he told the governors, the Republican measure would permit the states “to develop your own ideas on child care, ideas that will treat child care in the way that is best for you and the families in your communities instead of having the federal government jump in.”

Reagan said that “government should tread carefully and humbly” in developing child care programs “because we’re dealing with the most fundamental element of human society, the family.”