Sick and disabled people should take control of their own personal “wellbeing” budget, which will roll up their care, disability and employment payments into a single cash lump sum, Labour will announce on Wednesday.

In a major speech at the think tank Demos, the shadow work and pensions secretary, Liam Byrne, will call for radical reform of social security for disabled people, which will free them from the debilitating rounds of testing that currently bedevil the benefits regime.

Instead Bryne will promote a “tell us once” policy and propose a single assessment for disabled people for all their social care and health needs, their disability payments and employment and support allowance. Currently each system has its own testing regime – which has fuelled anger among people with disabilities.

The Labour shadow cabinet member will argue that the coalition is “comprehensively” failing disabled people. Since 2010, poverty levels among disabled people have been rising – with 30% now living in penury.

Byrne will also point out that the government’s flagship welfare-to-work scheme – the Work Programme – was supposed to get one in six sick and disabled people into a job for a least three months. In fact, the actual performance, two years since the start of the scheme, is more like one in 20.

With the autumn statement expected to bring forward more tough benefit measures, Labour will argue that there should be a report into how the government’s actions so far have affected the disabled before ministers continue with their policy agenda .

Most important for campaigners is that Byrne says that the work capability assessment (WCA), the test used to see whether people claiming disability benefits are fit to work, will be reformed. He points out that disabled people taking the WCA are eight times more likely to end up in a tribunal than in a job.

Bryne told the Guardian that a key part of the test used to decide whether a person needed support to get a job, rather than simply saying people are ready to find employment would be reinstated by a future Labour administration.

The new system is modelled on the Australian National Disability Insurance Scheme – which integrates back-to-work support, social care, and disability benefits in a single personal budget. Signed into law this year it is regarded as the most important change in social services in Australia since the introduction of universal health insurance.

Bryne will point out that “today, someone in our country is registered as disabled every three minutes. Disability can affect any of us and therefore it affects all of us. I think it’s time Britain should explore lessons from Australia … to help give disabled people the support they need to get on, and lead to a more fulfilling life.”

The Guardian