Young handicapped people receiving the Wajong benefit will be reassessed and those who can work will be found jobs, junior social affairs minister Jette Klijnsma said on Friday.
Until the assessments are carried out, the young handicapped will receive basic welfare payments (bijstand), the minister told parliament in a written briefing.
The move is part of a radical shake-up of the special-needs job sector.
Klingsma says there are currently 230,000 youngsters receiving the Wajong benefit, of whom 40,000 are completely and irreversibly handicapped. Those 40,000 will keep the Wajong benefit.
The rest will be reassesed, a move the minister says will save €1.2bn over the long term.
The number of those claiming the Wajong has increased exponentially since responsibility for the benefit was handed to councils in 2006.