The federal government wants single parents moved to the Newstart allowance when their youngest child turns eight.
The changes would save the government $728 million over four years.
Single mums will rally against the changes at Parliament House on Canberra on Tuesday morning.
The Social Security Legislation Amendment (Fair Incentives to Work) Bill 2012 is expected to be debated in the Senate on the same day.
The Australian Council of Social Service says single parents will be left between $60 to $100 worse off a week because of the changes.
The government says the policy will encourage parents with school-age children to re-enter the workforce sooner.
Both the Parliamentary Joint Committee on Human Rights and Senate's employment and workplace relations legislation committee have said the government should defer the measures until the outcome of an inquiry into the adequacy of Newstart is known.
National Council of Single Mothers and their Children chief executive Terese Edwards told AAP the $60 to $100 a week payment cuts could see single parent families homeless because they can't pay their rent.
"It's the difference between maintaining your house or not," she said.
Ms Edwards said the federal government wants the payment cuts to begin on January 1 which will be a "cruel blow" for single parent families struggling to get through the Christmas and school holiday period.
"It's already one of the most difficult times in a sole parent's year," she said.
"Christmas in itself is a an emotional and difficult time and financially challenging."
She said the federal government's time frame on implementing the changes is too short and there hasn't been enough public awareness generated so it will come as a shock to many single mums.
Ms Edwards is also concerned not enough effort has been made to ensure that indigenous single mothers in remote communities know about the changes.
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