THE economy minister is understood to have rejected proposals which would have allowed him to approve funding for dozens of charity groups in the absence of a draft budget for next year.
Finance Minister Conor Murphy had written to Economy Minister Gordon Lyons earlier this week to suggest how funds could be allocated to allow groups reliant on the EU's European Structural Fund (ESF) programme to access money in limited circumstances.
Around 67 groups who work with around 17,000 people across the north rely on millions of pounds from the ESF.
But this money is only given if the executive provides 'match funding'.
The match funding will run out at the end of next month, sparking fears of job losses and cuts to services for vulnerable people.
No departmental budgets for 2022/23 can be set in the absence of an executive.
However, Mr Murphy said that the Treasury, in a highly unusual move, had agreed that money could be allocated from this year's budget to some groups, including those who are at risk of insolvency if funding is not approved.
Sources told The Irish News that the proposals had been rejected by Mr Lyons.
The Department for the Economy had not replied to a request for comment last night.
Mr Lyons is in Dubai to promote Northern Ireland at the World Expo 2020.
Around 20 groups had previously written to Mr Lyons to highlight their concerns.
Some match funds have already been agreed by the Department of Health and several councils.
Communities Minister Deirdre Hargey announced yesterday her department will provide match funding of £1.5m for 18 ESF projects, including those helping people to return to employment.
The projects support around 3,900 people.
"The absence of an agreed budget created real uncertainty for these groups for the year ahead, with some reporting that they would be unable to survive without the ESF matched funding they receive," she said.
"I am therefore pleased to announce that my department will continue to provide the £1.5m matched funding to existing ESF projects for 2022/23."
Finance Minister Conor Murphy said he met representatives from the community and voluntary sector about the issue last week.
"Having written to ministerial colleagues on this issue, I welcome confirmation from the communities minister that she will provide these groups with match funding," he said.
“These community and voluntary organisations help thousands of vulnerable people into employment and are a key government partner."
