A WHOPPING $164.1billion social security and welfare budget comes with tight new measures to ensure the payments are not misused.

From July 2018, people receiving welfare will be subject to a demerit point-based system that could strip payments from non-compliant jobseekers for up to a month.

The Coalition said the strict policy would crack down on about 100,000 people who continually failed mutual obligation requirements.

From January 1 next year, 5000 New Start or Youth Allowance recipients will also be selected for random drug testing.

Member for Maranoa David Littleproud said the measures would ensure people addicted to drugs would be able to get the help they need and prevent taxpayer dollars from being spent on illegal activities.

"If you're affected by drugs, you're obviously not making good decisions so that's why this new drug-testing regime - and other jobseeker compliance measures - is integral in this overhaul of our welfare system, as outlined in last night's Budget,” Mr Littleproud said.

"Hard-working Australians don't expect their tax dollars to fund a welfare recipient's drug habit and this Coalition government will ensure our welfare system provides strong incentives for people to tackle any barrier which stand in their way when looking for a job.”

The 2017/18 budget has also included additional measures to help lower income Australians.

Pensioners affected by the asset test change will have their pensioner concession card reinstated, allowing an extra 92,000 people to access discounts such as subsidised hearing services.

The Medicare levy low-income threshold will increase so low-income tax payers such as singles, seniors and pensioners remain exempt.