The axeing by the Government of a hardship fund for people in crisis – including the homeless and domestic violence victims – has been branded “sickening” by the leader of Bradford Council.

Councillor David Green described the fund as a “lifeline” for people at the most vulnerable times in their lives, helping them to keep their lives on track.

But the Government said the Council could continue to fund the scheme through its own budgets if it chose to do so. Currently, the fund allows Bradford Council to hand out small cash payouts, usually of less than £100, to families who cannot pay for food or fuel because of an emergency.

Examples could be because they have had their money stolen, or have had an unexpected problem with a benefit payment. They can also help people in crisis set up a home, by providing goods or furniture, through an organisation called Families First.

The people they help include those fleeing domestic violence, homeless people who have been offered a house or flat but have no way of kitting it out, or convicts fresh out of prison who have nowhere to go to.

The fund was originally controlled by the Government, but from April the responsiblity moved to local authorities, with the cost still being met by the Government. Since then, Bradford Council has handed out £798,000 in cash or goods to 3,818 applicants under the Local Welfare Provision scheme. But from 2015-16, the Government will stop funding the scheme across England. It is worth £2.2 million a year in Bradford. Coun Green said the cut would prove to be a false economy, as it would be more expensive to have to step in and help families once their lives started spiralling out of control.

He said: “This is another pernicious and vindictive Government attack on people when they are at their most vulnerable and need a lifeline to keep their lives on track and homes and families together. In purely financial terms it is a false economy because it will tip people into chaos and crisis, leading to far higher costs being incurred as public services are forced to make interventions. But there will also be big social and emotional costs with the potential for children to have to be separated from their parents, for physical and mental health to suffer and homelessness to increase.” He said the authority now faced the decision of whether to allow the hardship fund to disappear or cuts its services still further so they could pay for it themselves.

A Government spokesman said: “Councils will continue to provide support to those in their community who face financial difficulties or who find themselves in unavoidable circumstances. In contrast to a centralised grant system that was poorly targeted councils can now choose how to best to support local welfare needs within their areas – what is right for inner London will not be for rural Cumbria.