George Osborne has warned parents on benefits they must make a "financial decision" about whether to have more children as he confirmed the Government is looking at how much money they receive.
The Chancellor said he was "asking questions" about whether mothers and fathers should automatically get more cash if the size of their family increases.
Mr Osborne is to set out plans to slash a further £10 billion from the welfare bill on top of the £18 billion of cuts that are already under way in a bid to balance the books.
He insists the economy is "healing" and points to a reduction in the deficit and a boost in the number of private sector jobs as proof. But he sidestepped questions over whether austerity measures will continue into 2018.
"We have a debt target to get debt falling by the year 2015/16 but instead of Chancellors these days assessing their own performance against that target, you've seen those fiddled Treasury figures which undermine confidence in the past, we now have a completely independent body, called the Office for Budget Responsibility, that assesses our progress against these things and you are going to hear that assessment on December 5," he told BBC Radio 4's Today programme.
Mr Osborne said the Conservatives were looking at whether it was right that parents on welfare automatically received extra cash for having more children amid speculation that child benefit, income support or tax credits could be withheld.
The Chancellor told BBC Breakfast: "One of the questions we ask is when you are in work and you want to have another child you have to consider the financial cost of that because it is an expensive thing to do, wonderful as it is to have more children.
"When you are on benefits you automatically get extra money when you have a child, so you can be better off. We are just asking the question, does that work? Is that the right value we have in our society?
"We are very clear by introducing a benefit cap, for example, next year that there should be a limit on the total amount that you get no matter how many people there are in your family so that no-one out of work gets more than the average family gets by going out to work."
Mr Osborne denied hammering the poor and said there would be new taxes on the wealthy in the coming years. "The rich are paying more and they will have to pay more and there will be new taxes on rich people in the years ahead," he said.