An overhaul of Incapacity Benefit is due to be announced in Parliament today.
The payments are likely to be renamed and there could be financial penalties on those who do not actively seek work.
The benefit, given to those unable to return to work, currently varied between £56 a week to £74.
Under Labour proposals, a flat-rate of £56 would be introduced. But financial penalites will be taken on those who do not attempt to look for work, if they are able to.
Incentives will be offered for claimants to undergo training, rehabilitation classes and attend work-focused interviews.
Charities such as Leonard Chesire have voiced concerns that the plans could damage disabled people already living in poverty.
"People whose condition causes them pain or fatigue should not be forced to look for employment," said a spokesman for the disability charity.
The Conservatives have claimed that the proposals will not work, and have suggested that a scheme run by the voluntary and private sector could get 250,000 people into jobs.
The Liberal Democrats accused Labour of applying a "one-size-fits-all" approach.
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