Manchester City Council is set to reduce its voluntary sector budget by 19 per cent, from about £63m to about £51m, over the next two years.
The council published its proposed budget for 2011/12 earlier this week, setting out how it will make overall savings of £109m in the next financial year and £170m of savings in 2012/13.
The £51m figure over the two years is made up of payments to voluntary sector organisations in the form of both grants and contracts.
The council was unable to provide details of how much of the £51m consisted of grants.
The budget proposal documents say that infrastructure support for the sector is being reviewed. A final decision is expected to be taken by the council on 8 March.
Bernard Priest, executive member for finance and human resources at Manchester City Council, told Third Sector that full impact assessments would be made of all the cuts.
He said the council was hoping the voluntary sector would start delivering some services that had previously been delivered by the council over the next couple of years.
"We’re not happy with the cuts to Manchester and we’re not afraid to say it," he added.
Alex Whinnom, director of Greater Manchester Centre for Voluntary Organisation, said he was not surprised at the extent of the cuts.
"I think the council has had an impossible job to do," he said. "This is far worse than anyone imagined under any government. The effect on the sector is much worse than we predicted."
Whinnom said he thought some organisations would have to close if they were relying on council grants in order to stay open.
"The government talks very eloquently about their vision of the big society," he said. "But what’s happening now is going to prevent that vision from being realised. It’s very sad."