Immigrants will be forced to pay to visit a GP and be banned from getting council houses for up to five years after they settle in Britain.
The moves, to be signalled by David Cameron this week, mark a new hardline stance on immigration aimed at reviving Tory fortunes.
The Prime Minister intends to introduce legislation on both issues in the next few months, despite the likelihood of strong opposition from Labour MPs.
The measures are to be rushed through to stop Bulgarians and Romanians being allowed free access to the UK next January.
A senior source said: ‘The PM wants the immigration system to back people who work hard and do the right thing. He is determined to bring an end to the situation where people can come to the UK and get benefits and public services without putting anything in.