Social Development Minister Paula Bennett says more funding is in the pipeline for community budgeting services - but it's too early to say if it will save Whangarei's Salvation Army budgeting service from closing.
The Salvation Army announced this week it faces losing a third of its budget advisers nationally as the Government's temporary Community Response Fund (CRF), introduced in 2008 to help social services cope with the demand brought on by the recession, dries up in July.
Whangarei Salvation Army community ministries director Pete Mullenger said the funding cut meant it could no longer carry out budgeting services in the city and these would cease from August.
"The Government has made it a condition that beneficiaries need to get budgeting advice, but then takes away the funding it has given specifically to help give people budgeting advice. It's frustrating."
He said the recession and the damage it had caused, particularly to poor families, had lasted far longer than expected, with no end in sight for demand for the army's social services.
Mr Mullenger said negotiations were going on with Whangarei Budgeting Services and the Anglican Care budgeting service to see if they would take over the army's service, which has two paid and two volunteer staff.
However, both those services face the same funding cutback and Mr Mullenger said they were likely to be stretched further if they took on more clients.
Ms Bennett said she wanted to make it clear there is an intention to support budgeting services to continue providing services.
She said there will be money coming, and soon, because she is well aware of the issues around staffing.
"We think organisations like the Salvation Army do an outstanding job providing services in the community and the Government has a role to play alongside. We're aware of the current pressures and as such will be making an announcement about budgeting services shortly."
An announcement could be made in this month's Budget.
She said the benefit reform Future Focus introduced a new hardship model which has placed greater obligations on repeat applicants for hardship assistance. Those who apply for additional hardship assistance three or more times in 12 months have to take budgeting advice.
But Mr Mullenger said it was too early to say if the new funding would be enough to save the service in Whangarei.
"We will have to wait to see the finer details of what that funding will be," he said.