The new Welfare Reform Bill will make it tougher for people to claim unemployment benefits, at a time when more redundancies are expected.
Experts have slammed the new bill saying it will affect the most vulnerable people in society and won't address the problem of creating more jobs.
The new Bill will see benefits curbed for the unemployed and stricter penalties for those turning down jobs, but action groups say the issue lies in the lack of available jobs.
The new changes were outlined in the Welfare Reform Bill, which introduced a single universal credit, to come into force in 2013, as well as an annual benefit cap of around £26,000 per family.
Changes will also be made to the Disability Living Allowance, a back-to-work programme introduced, a review of sickness absence levels and a fine of up to three years loss of benefits for those refusing to work.
At the heart of the Bill is the introduction of a universal credit. This is to try and end the current confusion that exists in a system with over 50 different benefits and payments people can claim.
Describing the Bill as "a new culture of responsibility" David Cameron said with five million people on out-of-work benefits unemployment has become the norm in many communities.
Unemployment rises again
But Unite assistant general secretary, Gail Cartmail, has expressed concern over the changes. She says the government is creating a benefit system to drive the unemployed to seek jobs that don't exist.
"There is a large degree of dysfunction in government policy as there seems to be no policy to boost the manufacturing industry and support exports – ministers want the private sector to create the jobs lost in public services, but without creating the climate and mechanisms to achieve this" she adds.
Co-chair of the Liberal Democrat Parliamentary Committee on work and pensions, Jenny Willott, says the reforms focus on helping people into work, ensuring they stay there, and adopting a more tailored approach to addressing people's welfare needs.
But General secretary of the TUC, Brendan Barber, disagrees and has expressed concern over the loss of benefits to the most vulnerable society members.
He says: "These proposals clearly show that the government is targeting some of society's most vulnerable people to pick up the cost of the recession.
"We are very definitely not all in this together - while the champagne corks pop in the City as yet another round of mega bonuses is announced, disabled people are facing harsh cuts to their already meagre support allowance."