There is a debate surrounding when a referendum over Scottish independence should be heldThe Cabinet is set to discuss proposals to give the Scottish government the legal power to hold a binding referendum on independence.
It is understood Downing Street may lay down a time limit specifying when the vote should take place, possibly within the next 18 months.
Any vote would be between leaving or staying in the UK and there would be no option for greater devolved powers.
The Scottish government says it should decide the referendum timing and form.
The Scottish National Party has pledged a referendum in the latter half of its term, with 2014 thought to be the preferred date.
But Downing Street is expected to confirm that without the backing of Westminster, any result would only formally have advisory status.
David Cameron has said uncertainty was damaging Scotland's economy.
The prime minister told Andrew Marr, in a BBC interview on Sunday: "I think it's very unfair on the Scottish people themselves who don't really know when this question is going to be asked, what the question is going to be, who's responsible for asking it.
"And I think we owe the Scottish people something that is fair, legal and decisive."
BBC political editor Nick Robinson says privately ministers speak of turning the screw on First Minister Alex Salmond, who has yet to spell out when or how he intends to fulfil his life-long ambition of independence.
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