Navca has estimated that 26,000 staff at local charities will lose their jobs this year.
The local infrastructure organisation has demanded that local and national government intervene by protecting funding and taking action against councils that make drastic cuts to voluntary sector budgets.
Kevin Curley, chief executive of Navca, said: "Many local authorities claim that they have no choice but to slash funding for local charities and community groups.
"But we know there is a choice because Reading Council has increased funding to the voluntary and community sector by £200,000 to more than £7m."
Curley called for councils’ voluntary sector budgets for 2011/12 to be ring-fenced at their current levels and for the government to step in to prevent local authorities from making drastic cuts to sector budgets.
"The government cannot keep saying that local councils are free to do what they want and then complain when they cut funding to the local voluntary and community sector," he said. "We estimate that 26,000 people working for local charities will be losing their jobs this year. This will mean the end of many services local people need.
"The government needs to act to stop councils making these cuts. If they do not, David Cameron’s insistence that councils look elsewhere for their savings will be ignored and his big society policy will be irretrievably undermined."