GEN X and Y Australians on the disability support pension will be required to undertake work experience or some form of employment activity.
Some of those under 35 years of age, who were granted the pension between 2008 and 2011 under more lenient rules, will have their claims reviewed against the current impairment tables.
The measure is expected to save the budget $46.4 million over five years.
Recipients will be required to have a participation plan that encourages work experience, training and work for the dole activities.
The compulsory program, aimed at increasing work force participation, will receive $29.3 million over five years.
People with severe impairments, terminal illnesses or who have an assessed work capacity of less than eight hours a week will be exempt.
There are 800,000 people on the disability support pension with projections of a 27 per cent increase by the end of the decade.
From January 2015, recipients will only be able to travel abroad for four weeks - down from six - before their payments are cut off.
People with terminal illnesses or severe impediments will be exempt.
Meanwhile, the government is establishing a disability and carers advisory council.
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