The criticism follows the announcement of a £70 million boost for palliative care from Lottery fund distributor, the New Opportunities Fund (NOF).
Gill Oliver, director of service development for Macmillan Cancer Relief, said: "Macmillan Cancer Relief welcomes more money being made available from the NOF and targeted where there is greatest need.
"However, we feel it is outrageous that it is necessary for Lottery money to be used to fund palliative care services rather than funded through central government. Palliative care is an essential part of care for cancer patients and should not be seen as a luxury, she said.
The NOF money will fund the Palliative Care scheme, which is intended to help adults and children with conditions including cancer, and ease the burden on their families. Grants will be made to organisations providing home-based care, residential respite and bereavement services.
The scheme is being launched today by GMTVpresenter Fiona Phillips.
The Palliative Care scheme will deliver £48 million of funding to help children over the next three years. Of this, £15.3 million has been ring-fenced for palliative-care hospices. The remaining £32.7 million of the children's fund will go towards home-based respite services and centres as well as bereavement services for families.
Primary care trusts in areas where palliative care is urgently needed and that are economically depressed can apply for funding from the £22 million adult side of the scheme.
This money will go towards home-based palliative care for adults, across a range of services including existing community teams offering palliative care, so that more people with illnesses such as cancer can access a wider range of services at home.
The Palliative Care scheme will roll out in January 2003.
Macmillan Cancer Relief received funding last year from the NOF for four palliative-care projects in the UK. The money enabled the charity to improve access to palliative care for disadvantaged communities, including providing more specialist nurses, training for all health care professionals and practical home support.