Clinton Task Force Rejects Welfare Cutoff : Policy: Panel looks for ways to make good on his campaign pledge to reform aid system. It plans to offer the President a list of options later this month.

As President Clinton nears a decision on how to make good on his popular campaign pledge “to end welfare as we know it,” his task force on the issue has concluded that simply cutting off recipients’ federal aid after two years will not be one of the options.

Clinton’s presidential campaign rhetoric frequently included tough--and well-received--talk about how his plan for reforming the nation’s welfare system would put a two-year limit on benefits.

But White House experts, scheduled to deliver a formal set of options to Clinton later this month, are proposing that recipients cut from the welfare rolls after two years be guaranteed community service jobs--also at government expense--if they cannot find private sector employment.

The concept is almost certain to be part of the welfare reform initiative the President is expected to outline in his State of the Union Address next month. It is also expected to include provisions to enforce payment of court-ordered child support and to increase education, job training and child care designed to help welfare recipients become self-sufficient.

According to one expert, Will Marshall, president of the liberal Progressive Policy Institute, the guaranteed-government-job approach is in keeping with Clinton’s campaign message.

Most people focused their attention on the two-year time limit, Marshall said, without realizing that Clinton was also talking about the rather radical notion of guaranteeing people work.

“The message was that people were going to have to work, beyond that it got fuzzy,” said Marshall. “I imagine people thought it was going to be a job in the private sector.”

Both Administration insiders and Republicans say, however, that they fear the approach would make it impossible to realize the level of budget savings Clinton has implied welfare reform could achieve.

The situation highlights the tangled path facing the President as he tries to implement his welfare reform plan. It also demonstrates how difficult it will be for him to keep his promise to voters, who are looking for a revamped welfare system that encourages work over dependency without hiking taxes.

The proposal is expected to run into opposition from conservatives who contend that creating community service jobs would cost more than the current welfare system and, so far at least, Clinton has not indicated a willingness to fund these jobs through reductions from other social services.

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Republicans in the House and Senate support Clinton’s concepts of a time limit on welfare benefits and community service jobs for welfare recipients who cannot get private-sector jobs. But they are ready to oppose the plan unless the President includes substantial cuts elsewhere in the federal budget to pay for it as their proposals do. The House Republicans’ welfare reform strategy, for example, would reduce benefits for immigrants, cut some food programs and force women to name the fathers of their children--so they can be made to provide financial support--or lose their welfare checks.

Even members of his own Welfare Reform Working Group are quietly scratching their heads about how to pay for the measure.

“Community service jobs are going to cost more, not save money,” said one Administration official.

Salaries for community service jobs likely would be paid through a mix of federal and state tax dollars and could amount to redirected Aid for Families With Dependent Children benefits. Federal and state aid also could be needed to pay for child care, transportation and training.

“It is simpler just to leave a person home and provide a welfare check,” the official said. “It’s cheaper in the short term.”

Administration officials argued, however, that such short-term “investment” in individuals will pay dividends by helping recipients develop job skills and a work ethic that could make them employable in the private sector.

Bruce Reed, one of three chairmen of the working group, stressed, however, that most of those leaving welfare after two years will not need to be placed in community service jobs.

“We have a real bias toward private sector jobs,” said Reed, a deputy assistant to the President for domestic policy. “A private sector job is a ticket to upward mobility.”

The kind of jobs the Administration planners have in mind are low-paying, entry-level jobs. To help people on public assistance get those jobs, the Administration is considering beefing up programs that give employers incentives to hire welfare recipients.