A benefits crackdown that was revealed on Monday ahead of the municipal elections threatens to deprive disabled people of their monthly payments and replace them with vouchers.

Other solutions under consideration are providing treatment in lieu of financial support or requiring receipts in order to make a claim against the state.

The suggested modifications to the Personal Independence Payment (PIP) will be made public as a part of a larger initiative that Rishi Sunak is supporting in order to address the issue of unemployment in the UK.

On Monday, he will publicise the preparations for a trip outside of Westminster while the Conservatives prepare for the likely painful results of Thursday's local elections.

Earlier this month, Mr Sunak voiced alarm about the increasing number of people being signed off sick, arguing that politicians have to question whether the welfare system is working as well as possible. Critics have warned that those in genuine need could lose out.

A Government source familiar with the plans told The Telegraph: “These reforms are not about making the safety net less generous, but PIP is a blunt and increasingly unsustainable benefit.

“By the end of the decade, the bill will have more than doubled since Covid to over £30 billion. So we need a proper conversation about whether the current approach is best supporting the rising caseload, particularly those with mental health conditions.

“We owe it to those who need the help the most to ensure the system is sustainable and working for them, including by providing extra support for those with the most severe conditions.”

On Tuesday, Mel Stride, the Work and Pensions Secretary, will address the Commons about the plans, which are being published in a green paper consultation.

PIP is one of a number of forms of financial support people with disabilities can get from the Government. It is separate from incapacity benefit, which is paid for those too ill to work, or support which can be given to disabled people in work via the Universal Credit system.

Around 2.6 million people of working age currently receive PIP every four weeks, which can amount to as much as £5,000 a year and covers any extra expenses for people with disabilities, from stairlifts to taxis.

The £22 billion spent annually on the payments is forecast to rise by 50 per cent in four years as more people, including those with mental health concerns, qualify for the support.

It has led the Government to propose a total overhaul of how the system works, with provisional ideas outlined in the consultation as ministers seek to work up specific plans after responses.

The Telegraph understands that one idea raised is one-off grants for costs such as home adaptations or expensive equipment. 

Vouchers that can be spent on improvements is another. A third is that disabled people would have to provide receipts for the purchases of aides or appliances, and a fourth option would be for those with mild conditions to receive more state-funded treatment instead of money.

In an interview with The Times, Mr Stride said many voters “deep down” agree with him on welfare reform, adding he thought it “extraordinary” that Labour is refusing to say whether it supports the announced benefits changes.

He also said it was an “open question” as to whether people with conditions such as ADHD or learning disabilities should receive cash disability benefits, because “they come in all sorts of different forms of scales of severity”.

Another approach expected to be in the consultation is that people with long-term serious conditions should not be reassessed for PIP, thus easing the burdens on some people receiving payments.

The consultation will make reference to similar models in other countries, such as New Zealand, where a health practitioner verifies extra costs, and Norway, where a letter from a GP outlines costs associated with someone’s condition.

Mr Sunak said earlier this month that the number of people claiming PIP for mental health reasons had more than doubled, despite limited evidence that those suffering with conditions like anxiety face higher living costs as a result.

His plans will aim to cut the soaring welfare bill. With £69 billion now spent on benefits for working age people who are disabled or have health conditions, the cost now outstrips the budget for schools or transport.

The Prime Minister told The Telegraph earlier this month that reforming the welfare system was proof that the Tories were “delivering change on the things... that the country cares about”.

He is expected to make campaign stops across the UK this week ahead of Thursday’s local elections, but when asked about the party’s fortunes on Sunday he told Trevor Phillips on Sky that “local elections are always difficult for incumbent parties”.

Number 10 hopes the benefits reforms will draw a dividing line between the Conservatives and Labour in tackling the country’s “sick note culture”, but they are likely to trigger renewed criticism from mental health charities.

James Taylor, the director of strategy at Scope, the disability equality charity, said Mr Sunak’s speech on the need for reform to the benefits system felt “like a full-on assault on disabled people”.

Johnny Timpson, one of the Prime Minister’s dementia champions, quit last week in protest over the treatment of disabled people and the complexity of the system.

On Monday, Labour will publish new data showing that more than 120,000 children waited six months or longer to get mental health support on the NHS. The party is proposing to deliver 8,500 specially-trained mental health staff and specialist mental health support in every school.

Sir Keir Starmer, the Labour leader, said: “I will not sit on my hands while tens of thousands of people have their lives on hold and ambition curtailed while they languish on mental health waiting lists.”