President Carter has decided on a new welfare proposal that would cost $5.5 billion to $6 billion a year more than existing program, government sources said yesterday.
The plan approved by Carter for submission to Congress is a sharp retrenchment from the $17.4 billion Carter proposal that failed to reach the floor in the last Congress.
The cutback reflects both the administration's desire to keep government costs from rising sharply in the next few years, and the realization that Congress is unlikely to approve any massive new spending proposal at a time of pinched budgets.
Although not all details have been made final, the plan is said to contain these major elements:
A target date of 1982, at which time it would add about $5.5 billion a year to federal welfare outlays running $25 billion a year.
A minimum welfare payment of about two-thirds of the poverty line for families with children. At present the poverty line is $6,200 for a family of four. The two-thirds guarantee would include the combined value of any food stamps received by the family, plus the cash welfare payment. The food stamp program would continue in existence and won't be "cashed out." About a dozen states at present pay welfare benefits that, combined with food stamps, don't reach two-thirds of the poverty level.
Inclusion of 300,000 to 400,000 public service jobs for welfare clients able to work, the cost of which would be partially offset by savings on welfare payments to those persons.
Several hundred million dollars in fiscal relief for the states on welfare costs -- nothing like the several billion dollars in last year's plan.
Some expansion of the earned income credit (a federal payment to lowincome families earning $6,000 or less.