Vince Cable, the business secretary, will say on Wednesday that government plans to block illegal filesharing websites under the controversial Digital Economy Act are in effect unworkable.

Outlining the government's response to the Hargreaves report on the future of UK copyright law, Cable is also expected to announce legislation to sweep away restrictive rules on file copying and parody works.

In a speech at the British Library on Wednesday, the Liberal Democrat minister will outline the next steps for the introduction of the delayed Digital Economy Act.

Cable will row back on one of the act's most contentious measures – introducing legislation to block access to copyright-infringing websites – and instead suggest that the existing Copyrights, Design and Patents Act is powerful enough.

That follows last week's landmark high court ruling, which forced BT to cut off access to Newzbin2, a site found to be infringing copyright "on a grand scale".