The Government was accused last night of turning its back on Irish communities in Britain by Fine Gael TD Mr Michel Ring.
Mr Ring said he was "shocked" to learn that funding under the Díon (shelter) programme to welfare groups in Britain has been cut by 5 per cent.
Last year the Department of Trade, Enterprise and Employment allocated €2.7 million to the organisations to help down-and-out Irish emigrants.
Last month a delegation from the Federation of Irish Societies travelled to Dublin seeking assurances from the Minister for Foreign Affairs, Mr Cowen, that the grant would not be cut.
The Task-force on Emigration, in a report commissioned by Mr Cowen, suggested a 500 per cent increase in funding for welfare groups in Britain this year.
Mr Ring said the cutback would severely hinder the work of welfare groups. "This is a terrible kick-in-the-teeth to Irish emigrants. These are the people who helped their families at home financially after they were forced to leave this country.
"Today many of them are on the breadline and deserve any support they can get from the Government." Mr Ring appealed to the Minister to reverse the funding cutback as a matter of urgency as it would have a severe impact.
Father Jerry Kivlehan, spokesman for the Federation of Irish Societies and director of the London Irish Centre, said they were given no indication that the grant-aid was to be cut.
He said: "We built up a lot of hope after the Task-force on Emigration report was published, so now we feel very let down. We felt the report was a genuine effort by the Government to help Irish emigrants, so this is undoubtedly a huge setback for us."