The Bromford Group, which provides social housing for vulnerable people, has called the cuts 'short-sighted' and said that hundreds of lives are at risk of being 'forced into a downward spiral'.
The reality of Staffordshire County Council's decision to slash its Supporting People funding by £6 million hit home yesterday when 84 staff were told their jobs were on the line.
The cuts are part of the authority's wider cost-cutting moves to shave £102m off the budget over the next five years.
But the moves have been criticised for hitting the most vulnerable, including the elderly and those with mental health problems.
Councillor Alan White, cabinet member for care, has defended the decision saying they wanted to offer a 'joined-up, county-wide approach' instead of looking at problems in isolation.
But today John Wade, Bromford's director of support, called the decision 'extremely disappointing.'
He said: "Bromford are seeing a number of contracts cut, with very serious implications for both our customers and our colleagues.
"It is putting hundreds of lives at risk of social exclusion and forcing them into a downward spiral."
In total, more than 200 contracts with around 40 different organisations are being severed. They include mental health service provider Rethink and Community Alarms, which supplies pendant alarms to pensioners living alone, will also suffer from the move.
At Bromford, the group's 1,300 service users will see their support cut or drastically reduced.
Mr Wade said: "What's most shocking to us is that the services we're already providing to the council, such as working with 'excluded groups', do exactly what Councillor White says the county needs. We believe the actions of the County Council are short sighted. They may make a short-term financial saving, but they will be storing up much bigger costs for the future."