Tougher sanctions are planned against people claiming Incapacity Benefit who refuse to take jobs, Work and Pensions Secretary John Hutton has said.
Mr Hutton says benefit rates will not be cut
Proposals for reforming the benefits are due to be unveiled this month.
Mr Hutton told the Work Foundation the new system would take a "something for something" approach.
He said the reforms would include an element of compulsion and said people who were able, but refused, to return to work could have their benefits cut.
But he said: "It will be dependent on measuring their ability to work fairly."
He promised more help for those who had no prospect of returning to work, with no proposals to cut or change the current benefit rates.
Sources have told BBC News sanctions would be used against existing claimants of the benefit, not just new claimants.
That will worry groups which say current claimants should continue under existing rules.
But it is understood other options have been ruled out, including means testing and time limits on people being able to claim the benefit.
'Not good enough'
Incapacity benefit, for sick and disabled people, is paid to about 1.8m people.
Mr Hutton is trying to win over Labour MPs concerned about the changes. Sixty-five Labour MPs rebelled against planned reforms to the benefit in 1999.
The minister said he wanted to go further than pilot projects on the Pathways to Work scheme, which offers incentives to those returning to work.
"While 80 to 90 per cent of people coming on to the benefit expect to get back into work quickly, many never do," he said.
"After two years on the benefit, someone is more likely to die or retire than to ever find a new job. Now that is just not good enough."
When his predecessor Andrew Smith launched Pathways to Work in 2002 he said: "This is not, and never will be, about pressurising sick people back to work against their will."
Mr Hutton said he wanted the new laws to be passed in the current session of Parliament and in operation by 2008.
He added: "The increased support we offer to people seeking to get back into the workplace must, I think, now be matched by increased obligations.
"The 'something for something' approach demands that state help is matched by increased responsibility on the part of claimants to take advantage of that support programme that governments can provide."
The Conservatives agree the system needs reform but say they think Tony Blair may have to water down his proposals to head off a rebellion among his own MPs.