This is right at the heart of Conservative ideology. Make the decision to go to work an easy one. One way to do that is to ensure that nobody can get more money on benefits than they would if they worked full time on the minimum wage. The idea is to force the country towards full employment - pay back the deficit and then reduce taxes. Critics ask where those who need more benefits (people with disablilties, the elderly etc etc etc) fit into this picture.
Welfare Reform and Work Bill
This is intended to encourage people into work but has been pretty controversial. It will create an annual benefits cap of £13,400 (£20,000 a couple - more in London).
The Lords are near to completing the process and it's already been through the Commons. This may be law very soon.