Work and pensions secretary John Hutton is today expected to outline plans to reform incapacity benefit payments with a single payment called the Employment and Support Allowance.
Claimants judged able to return to work will get training and help, but those who refuse could see their benefit cut.
About 2.7 million people currently claim the benefit, resulting in an annual bill to the taxpayer of £12.5bn.
The Welfare Reform Green Paper is expected to detail plans to roll out ‘back to work’ schemes currently being tested in seven regions across the UK.
These will offer tailored support to help sick and disabled people back to work by offering rehabilitation, training and advice.
GPs could also be offered cash incentives to encourage patients back into employment.
However, mental health charities have expressed concerns that the plans could make people with mental illness worse – ultimately costing the taxpayer more.