The official, who declined to be named, said that a number of voluntary organisations in west Wales and the valleys wrongly assumed their Objective One funding would continue under the Convergence Programme, which runs from 2007 to 2013.
"It was never certain that Wales would qualify for another round of structural funds, and we only received notification in December 2005," the official said. "So it was not very effective financial planning."
Some voluntary organisations have lost out because of the change in priorities under the Convergence Programme. Judith Stone, policy director at the Welsh Council for Voluntary Action, said that the new programme focused much more on employment and skills, rather than general urban and rural regeneration, a voluntary sector stronghold.
The implementation of the new Convergence Programme will differ drastically. "The Welsh European Funding Office wants a more strategic and collaborative approach so that projects don't get duplicated," Stone said.
The WEFO hopes to reduce the number of projects from 3,000 under Objective One to 500 under Convergence. Organisations will have to join up and work as part of a partnership on all projects.