BENDIGO Family and Financial Service could lose its financial counselling service after the Federal Government announced sweeping cuts to social services.
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All funding to the agency's financial counselling will be cut from February next year, after the funding was initially extended beyond 2014.
Bendigo Family and Financial Service general manager Jenny Elvey said they would have to wait and see what impact the cut would have, but they would have to make significant changes next year.
"Because the decision has come around Christmas time, we will have to wait to determine where the gains and losses will be," she said.
"Financial counselling is likely to be cut. It could still mean the program will have to be delivered in a different form.
"It's disappointing for agencies to find out days before Christmas that they will have to change the way they operate into the new year."
The Bendigo-based service will continue to offer debt consolidation and microfinance services.
Its primary purpose is to provide small loans and financial management training to those struggling because of lost hours at work, sickness, or unmanageable debt.
The Federal Government decision also resulted in cuts to housing peak body groups, including Community Housing Federation Australia, which would have its contract rescinded from June next year.
Haven Home Safe chief executive officer Ken Marchingo said the government would be worse off without the advice from these groups.
"They do valuable work in trying to give governments information so that they make sound decisions," he said.
"When you abolish these bodies, government tends to rely on a blinkered view.
"There are no simple solutions. When you have a thinned or hollowed out bureaucracy, then there's a desperate need to have these bodies providing sound advice."
Homelessness Australia was also among the bodies to be defunded.
Mr Marchingo said there would likely be flow-on effects, and the government's attempts to find savings could "come back to shoot them in the foot".
"It was a particularly churlish, uninformed decision to cut services at this time, right before Christmas," he said.
"What these programs provide is an element of innovation, but also an element of risk.
"Most of the cuts will impact demonstrably needed programs."