The green paper Breaking the Cycle: Effective Punishment, Rehabilitation and Sentencing of Offenders, which will now go out for consultation until next spring, features a series of proposals for youth justice.
These include:
Young offenders will also be helped to get off drugs and fresh efforts will be made to address mental health issues.
Clarke said: "The green paper is an important change of direction in penal policy, which will put more emphasis on reducing reoffending without reducing the punishment of offenders.
"By reforming criminals and turning them away from a life of crime we will break the cycle. This will mean fewer crimes, fewer victims and safer communities."
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