Teenagers who have dropped out of school, work or training will be able to earn an extra $30 a week from the Government for going back to class or taking budgeting courses under a shake-up of the welfare system.

And solo mums who find work before they are work-tested will be able to keep their benefit for longer. It will fall by $100 a week until it disappears - an extra financial hand to help with the transition into work.

Opposition parties are calling the financial incentives a bribe that will have little effect if no new jobs are available.

But Prime Minister John Key remains confident the economy will pick up and increase the number of jobs available.

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