Groups in the region criticised the administrators of the funds and suggested that money spent on regional infrastructure was being wasted.
Georgie Constable, director of Plymouth Community Partnership, said local groups were not benefiting from the spending. "We cannot see the benefit," she said. "There needs to be a review of what is being funded."
Constable said organisations that administer the money - such as Capacitybuilders, which runs ChangeUp, and the Big Lottery Fund, which runs the Basis programme - have failed to listen to local concerns.
"Their priority should be making sure there is infrastructure at the local level, but their priorities are at regional level," she said.
A source at a community group claimed that about 50 per cent of the money spent in the south west had gone on regional infrastructure.
"Mergers are also being pushed hard at local consortia level but are not being pushed regionally," she said.
A spokeswoman for Capacitybuilders said: "In our review of consortia and funding arrangements, we are looking at the balance between national, regional, sub-regional and local activities to make sure benefits flow to the front line."
A BLF spokesman said: "Funding from Basis is overwhelmingly weighted locally, with three-quarters of the 204 projects invited to make stage two applications working to strengthen sector groups at a local level."