Job hunters will be hit with random drug tests, stiff financial penalties and more cashless welfare cards through hardline measures revealed in the federal budget.
But the Turnbull government has offered vulnerable Australians some glimmers of hope through a housing affordability package and pledge to abandon $13 billion in deeply unpopular "zombie" savings measures.
Thousands of people will soon be forced to undertake random drug tests to hold onto their welfare payments.
Beginning next year, 5000 Newstart and Youth Allowance recipients across three locations will be roped into two-year drug testing trials.
Job seekers will be selected at random and tested for illicit substances including ice, ecstasy and marijuana.
Anyone who tests positive will have their welfare "quarantined", while those who fail more than once will be referred to medical professionals for assessment and treatment.
The trial is part of a suite of reforms to stop welfare payments being wasted away on drug and alcohol addictions.
Cashless welfare card trials will be expanded across two new locations, while welfare will be denied to people with disabilities caused solely by their own substance abuse.
Slack jobseekers who persistently dodge their obligations will face a demerit-point style warning system and escalating financial punishments under a hardline new regime.
Anyone who refuses to show up for job interviews or work-for-the-dole appointments without reasonable excuses will soon accrue demerit points and have their payments suspended until they re-engage.
Those who rack up four demerit points will then enter the "three strikes" territory and face climbing penalties.
* They will lose half their fortnightly payment for their first strike without a reasonable excuse;
* They will lose their entire fortnightly payment for their second strike; and
* Payments will be cancelled for four weeks for their third strike.
In either phase of the hardline compliance measures, job seekers who refuse work without a valid reason will have their payment stripped away for four weeks.
Welfare advocates are disappointed the government is returning down its well-trodden path of getting tough on social security clients.
"Here we have now trials for drug testing. In another welfare crackdown, compliance, big savings there," Cassandra Goldie from the Australian Council of Social Services told ABC TV on Tuesday night.
"The government seems to be wanting to say that we're still tough on social security when we know the big problem in Australia is jobs."
The compliance measures are expected to apply to around 1.22 million jobseekers per year, but roughly 1.14 million of these people are not expected to incur financial penalties under the new framework.
The penalties are expected to save the budget approximately $204.7 million.
Other welfare measures include tougher requirements for single parents, a crackdown on anyone trying to rake in multiple payments, harsher mutual obligations for older job seekers, and stricter residency rules for new migrants accessing pensions.
