Chancellor Gordon Brown and education and employment secretary David Blunkett jointly launched the jobs drive, combined with a new "employment credit".

The move will ensure that people over 50 who have been out of work for six months receive an income of at least £170 a week if they take a full-time job.

If they earn less, their pay will be topped up by the credit, worth up to £60 a week.

Those working between 16 and 30 hours a week will have a guaranteed minimum income of £110.

The extended New Deal programme - New Deal 50 Plus - will be launched in nine trial areas before going nationwide next April, when 1.2 million people will qualify.

The new scheme will cost

£270 million over three years.

Mr Brown said: "Around 30 per cent of over 50s are outside the labour market - twice as many as 20 years ago. New Deal 50 Plus demonstrates the Government's commitment to the promotion of employment opportunities for all."

Mr Blunkett said the extended scheme would tackle problems older people face such as having outdated skills.

He said: "We are balancing the necessity of setting young people on the ladder of work with the importance of retaining the skills and experience of active and mature people."

There will be four elements to the new scheme - personal advice, help with job searches, an employment credit and a training grant of up to £750.

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