Prisoners will be made to work and contribute towards the cost of keeping themselves in jail, Justice Secretary Ken Clarke will announce on Tuesday.
Mr Clarke will tell delegates at the Conservative Party conference in Birmingham that prisons are too often places of “institutionalised idleness”.
But the failure to work is no preparation for life outside the prison gates, he will say.
Mr Clarke will announce plans to create “meaningful employment” in prisons - with inmates expected to work a full 40-hour week, often for private sector employers.
The cash raised will be used to fund victim support organisations, he will say.
Mr Clarke will tell delegates: “We need to instil in our jails a regime of hard work.
“Most prisoners lead a life of enforced, bored idleness, where getting out of bed is optional.
“If we want to reduce the crimes these people will commit when they get out, whilst boosting the amount that can be provided for victim support, we need as many prisoners as possible to work hard for regular working hours.”
Prisoners will be paid at least the minimum wage, but money will be deduced to make reparations to victims of crime, help pay for the cost of their incarceration and to replace any benefits their dependents are receiving.