Rapists and murderers will no longer be able to claim compensation for being victims of crime under new plans proposed by the government.
Justice Secretary Kenneth Clarke announced a consultation on reform to the criminal compensation system on Monday.
"Victims in this country must be able to rely on a justice system which punishes offenders properly and ensures that victims who suffer serious consequences are properly helped and supported.
"Cash compensation should be better focused on blameless victims of the most serious crimes and more support for victims should be funded by offenders rather than taxpayers.
"Victims should be supported and not be let down by the criminal justice system. They are the people to whom we have the greatest responsibility. I believe all these proposals will go a long way to putting right the failings of the past," he said.
The Government will also, for the first time, compensate British victims of terrorist atrocities abroad on the same basis as victims of terrorism in Britain. Those with ongoing disabilities from attacks after 2002 will also receive financial support.
In the last decade, 20,000 convicted criminals have been paid more than £75m in compensation, but if the proposed reforms are put in place, people with criminal records will not be able to claim through the taxpayer-funded Criminal Injuries Compensation Scheme (CICS).
In the last year alone, more than 3,000 prisoners and ex-prisoners made claims to the scheme.
Victims' campaigners are likely to welcome the reforms. There was a public outcry when it was disclosed that Soham murderer Ian Huntley made a six-figure claim for compensation after he was badly injured by another inmate.
Sources say the reforms will ban further compensation payouts to those with criminal records, unless there are exceptional circumstances.
It is understood that those with criminal records that are spent will be eligible.
But criminal defence lawyer Greg Foxsmith criticized the measure as "gesture politics".
"The scheme as it currently stands has a prohibition on people with criminal records from reviving money, if the figures are as high as been quoted there has been a failure to enforce the current rules," he told the BBC's Today programme.
He added: "Anyone who is a victim of a crime is a victim... just because someone as criminal past doesn't mean they are any less deserving of compensation if they suffer from crime"
Tory MP Ben Gummer, a member of the home affairs committee, said when the scheme was set up in the 1960s it was for "blameless victims" of crime but that had now changed.
"I think it fails the common sense sniff test, why should people in prison or serving a sentence be able to claim compensation? The justice sec is rightly trying to do something about it."
The changes will also see criminals contributing towards the compensation scheme. The government hopes to take back £50 million a year from offenders through a victim surcharge.
Under present law, only criminals who are fined as part of their punishment are forced to pay the charge - which currently sits at a £15 flat rate.
But if the proposals are put through, the charge would be paid by anyone convicted of a criminal offence and could range from the present rate to £120, depending on the severity of the crime.
If offenders cannot pay the cash, it could be taken from their benefits or from money earned by working prisoners.
It is also understood that credit checking agencies will be employed to assess whether or not offenders can afford to pay the fines.