Fás will be replaced with a new agency called Solas.

Jobseekers will be forced to take on hi-tech courses with a new training agency, or risk losing their benefits.

Solas will be the State’s new further education authority after the Government said it will disband Fas, which became associated with dated courses and ended up mired in controversy over its spending of taxpayers’ money.

The new agency will teach modern high-end skills that can be used in industries like pharmaceuticals and information technology.

Education Minister Ruairi Quinn said under the new regime, unemployment benefits claimants will have to sign up to further education classes at local colleges or take on unpaid work experience.

“The labour market will not be passive anymore,” he said.

“If you lose your job, sadly, and if you apply for the benefits to which you are entitled, you will be asked to go on a course or two to do something that’s appropriate to your age and to your education profile.

“And that could very well be to engage in some form of community employment, and if you don’t accept that activation measure then there will be a financial penalty.”

He added: “We are saying ‘yes, you are entitled to your benefits but you must in turn take up a course’.”

The courses will be offered mostly by vocational education committees (VECs), which themselves are to be reformed.

Instead of the 33 old VECs there will be 16 “bigger, more efficient” local education and training boards.

Mr Quinn said the old system offered training from a variety of authorities in an irregular way. Solas will come under the control of the Department of Education and Skills.

Former Fas training centres and most regional staff are to be transferred to the VECs, according to Mr Quinn, while staff from Fas headquarters will transfer to Solas.

Michael Moriarty, general secretary of the Irish Vocational Education Association, said the reform was needed, but he added: “A lot of work remains to be done to see that the proposals are implemented efficiently and effectively”

Mr Moriarty said the success of the new system will depend greatly on the relationship between Solas and the VECs.