By Alex Stevenson Follow @alex__stevenson
Britain's deprived areas will suffer the most as a result of funding cuts to charities, according to a leaked report.
The Association of Chief Executives of Voluntary Organisations (Acevo), which administers funding for charities, was clear that "cuts to civil society organisations are likely to have a bigger impact on deprived areas" in its report to ministers.
The document, leaked to the Labour party, said that charities applying for funding to local authorities faced cuts of £524 million - a knock-on effect from cuts to councils by Whitehall's austerity agenda.
Shadow charities minister Gareth Thomas said: "David Cameron's claim that in his big society we're all in it together was never credible, but this leaked report confirms that ministers were being given independent evidence showing that charities were going to be hit very hard by funding cuts, with the poorest and most deprived areas being hit hardest.
"Yet ministers have failed to act, doing next to nothing to help, confirming again just how out of touch they are."
All charities faced total cuts of up to £5.5 billion, the report warned, but it is charities focusing on training and education which are expected to be hardest hit.
Over two-thirds of spending cuts will fall on the 25% most deprived areas of the country, the report claims.
"The plight of charities carrying out vital public services is in dire straits," a Whitehall source told the Observer newspaper.
"It is particularly bad for those who work in education and training, but the impact is across the board."
Local Government Association chairman Sir Merrick Cockell has insisted that councils are doing all they can to assist charities even when funding cuts are being imposed.
"Many councils and voluntary sector groups have sat down together to consider budgets and come up with joint solutions to the tough financial decisions they have had to take," he said last August.
"Even where local authorities have had to reduce the amount of money they give to charities, they are working to help them plug the gap by providing advice and support with services such as project planning, human resources and media promotion."
But Acevo's chief executive Sir Stephen Bubb has warned that spending reductions could fundamentally undermine David Cameron's bid to build a 'big society' based on the third sector.
"Charities cannot magic up the free labour to run a hospital or school or nursery any more than government or the private sector," he wrote in a comment piece for politics.co.uk last year.
"My real fear however is that if cuts continue to hit the sector at the scale and speed we've seen over the past few months, they threaten to be the banana skin on which the government's 'big society' plans fall flat."