The star of Channel 4's Benefits Street has said pre-paid cards to prevent claimants spending their money on "fags and booze" are "not a bad idea".
Deidre Kelly - known as White Dee - charmed a packed fringe meeting at the Tory conference by appearing to agree with the party's welfare policies.
She backed action to prevent young people entering a life on benefits.
But she clashed with an audience member who accused "people like you" of spending dole money on non-essentials.
"I have had to work hard to get the luxuries in life," he said, "Why should people like you get fags and booze on the state?"
"People like me? Is that directed to me?," replied Ms Kelly, before adding that she agreed unemployed people should not spend their benefits on "luxuries".
"I do prioritise. My children are my priority. I would never buy a packet of cigarettes above buying them a pair of shoes. But I understand there are people who would.
"But I do see where you are coming from as well. I don't think that's a bad idea of introducing maybe, like, a little card, where you can ensure people do get their groceries and their school uniforms."
But she added: "How would you keep control over every single person on benefits and try and control what they actually spend their money on?"
She was speaking before Iain Duncan Smith's announcement of a plan to give pre-paid cards to benefit claimants with drug and alcohol problems.
But she did make her feelings clear on the work and pensions secretary in general, saying he was "completely out of touch with the real world".
"How hard is it really to make a system that actually works?"
'Concentrate on kids'
Ms Kelly said she had not seen Chancellor George Osborne's announcement of three million more apprenticeships - to be paid for by a tighter cap on the amount households can claim in a year - but told the meeting better training for young people was vital.
She said the government had to "concentrate more on the kids" to "stop them going into the system and getting stuck there for years and years".
But she also criticised the tougher sanctions introduced by the government for claimants who do not accept offers of work, saying the jobs were not always appropriate, saying: "Not everyone wants to work in an office or build a wall."
"You have to look at the individual", she says. "What if there is nothing there for them at the end of the training scheme?"
The reality TV star resisted attempts by headline-seeking journalists to get her to back David Cameron or criticise Ed Miliband, although a question about what she thought of the Labour leader was met with a long silence before she replied, diplomatically, that she had never met him.
She did reveal that she was thinking of voting for UKIP - and that she has not ruled out standing for Parliament herself, but that it would have to be with her own party.
Ms Kelly shared the platform at the Policy Exchange debate with Conservative MP Mark Hoban and the think tank's head of Economic and social policy, Steve Hughes. It was chaired by BBC Newsnight Political Editor Allegra Stratton.