Employment Minster Michaelia Cash says the welfare system is there as a safety net, not something to fund people's lifestyles.
The Turnbull government will crack down on people who claim welfare payments while refusing to participate in work-for-the-dole schemes.
Employment Minster Michaelia Cash says there is a cohort of people in Australia that actively say no to suitable work
"I think all taxpayers would rightly expect that those who can work should work and our welfare system should be there as a genuine safety net, not as something that people can choose to fund their lifestyle," she told reporters in Brisbane on Monday.
The May 9 budget will aim to close a loophole that allows payments to continue despite people refusing interviews or placements.
"The problem at the moment is that people are escaping any financial penalty because of the loopholes Labor created," Human Services Minister Alan Tudge says.
"We are working on fixing this."
Labor frontbencher Katy Gallagher said she was a "bit suspicious" when this government attempts to demonise and attack those who rely on welfare.
"We support rigour around people being responsible for the money they receive and actually having to play by the rules. There is no problem with that," she told reporters in Canberra.
But Labor wants to make sure the government isn't being "harsh and unfair" by attacking those who are most vulnerable.
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