More than a million Australians are living in poverty despite two decades of economic growth, according to new research which calls for a radical policy shake-up to deal with the national "disgrace".

Just weeks before the federal budget, the Committee for Economic Development of Australia has found that between 4 and 6 per cent of the population - or between 1 and 1.5 million - is classed as being in poverty, "with little to no hope of getting out of that situation".

On Monday Social Services Minister Scott Morrison held a meeting with Liberal backbenchers in Canberra to discuss the government's welfare policy direction.

With the Coalition talking of the need to control welfare spending and get more people into the workforce, the CEDA report - to be launched on Tuesday by Victorian Housing Minister Martin Foley - is calling on the government to "tear up the rule book" to deal with entrenched poverty.