Former Home Secretary David Blunkett yesterday suggested communities should audit welfare benefit payments to decide if the money was being put to good use.
Speaking in Birmingham, Mr Blunkett described the idea as radical and "quite a challenge" but cautioned that it did not mean an " oppressive" system of means testing.
Giving the Joseph Chamberlain Lecture to the Balsall Heath Forum, he also said the audit should not lead to an 18th Century-style judgment of people's ability to work.
Later, a spokeswoman for Mr Blunkett's office was unable to confirm if the idea represented new Labour Party policy.
However, he has been appointed a key campaigner for Labour in the run-up to the General Election, expected on May 5, and is being tipped for a swift return to office if his party emerge victorious.
He told the forum: "I would suggest we set up an audit of all the public resources going into communities, like Balsall Heath, and look to see what is going in from the wider welfare state, I mean benefits and such like.
"Is it possible - without being oppressive about it - to liberate people and re-use those resources?
"I don't mean bringing in consultants from outside, I mean the communities themselves playing a role in this although of course there would need to be some expertise coming in.
"I pose it as a question, is it possible to release those resources back?
"Can we build the social capital in the community to give people the assets to change the world for themselves?"
Later, when asked by an audience member to expand on how that would be possible, Mr Blunkett said: "If you are pouring very large sums of money into one family and no member of that family is selfsufficient financially, we should look again at that situation."
The lecture was the latest visit Mr Blunkett has made to Balsall Heath, an inner city area where efforts at regeneration have attracted interest from many public figures, including the Prince of Wales.
Joseph Chamberlain was a former lord mayor and Birmingham MP credited with instigating widespread social reforms.