The council says the initiative misses out single people

The move could mean up to 15,000 asylum seeker families being given permission to live and work in the UK.

The Home Secretary, David Blunkett, said most of those being granted leave to remain were currently subsisting on benefits and that allowing them to work would lift a burden from taxpayers.

Peter Barry, a senior manager with the Scottish council, welcomed the change but expressed concern that it was driven by a desire to save money as opposed to valuing human rights.

He also said the initiative missed out single people, families whose children were born after October 2000 and people who applied for asylum first in a different country.

'Hard case' applicants

The move comes ahead of the final stages of a government shake-up of the asylum system.

Officials say the reforms - which will end all future support for families refused asylum - will ensure the system is not open to abuse or delays.

So-called "hard case" applicants will only be given benefits if they agree to comply with the removal process once it becomes possible for them to go home.

Official figures show that the taxpayer is currently supporting 12,000 families who applied for asylum prior to October 2000.

The Home Office said that moving 1,000 of them off benefits "will save �15m in support costs in addition to any potential savings on legal aid".

'Total chaos'

Up to 3,000 families who are self-supporting could also qualify to stay in the UK.

But Conservative home affairs spokesman at Westminster, Oliver Letwin, said the move sent out the wrong message and that people would be "appalled".

"It cannot be right, while the system still remains in total chaos, to send out a signal that 15,000 people who have failed to establish a claim will be allowed to remain indefinitely."