A $25 million funding boost for Canberra's community sector is "not remotely" possible, according the ACT Government.
But the sector's peak body says that some of the capital's poor and needy are being turned away from the services they need.
The ACT Government has contracts with the community sector, mostly through the health and community services directorates, worth $165 million per year but the ACT Council of Social Services (ACTCOSS) says at least $25 million more is needed each year just to keep up with burgeoning demand.
ACTCOSS Director Roslyn Dundas said that as much as $30 million might be needed as families hit by rising living costs seek help from community agencies.
But Treasurer Andrew Barr said today that even the lower figure, a 15 per cent boost on base funding, was out of the question with the territory's budget in the red.
"Everybody is under budget pressure, state and territory governments particularly, and the ACT is in deficit so nobody will be getting a 15 per cent boost to their funding in any area at all in the next budget," the minister said.
"It's a period of restraint for the next two or three years."
"In fact what we're looking to do is make savings."
Mr Barr said that any increase in taxpayers' money going to the community sector would be based on the established funding formula, based on a composite of the Wage Price Index and the Consumer Price Index.
"You're looking at something like 3 to 3.5 per cent increase for the community sector," he said.
Mr Barr said that instead of big funding increases, help would be given to the sector to find savings and efficiencies.
"We'll work with the community sector, particularly in relation to red tape reduction and procurement and ways that we can leverage the government's purchasing power to get them better rates for consumables that they use," Mr Barr said.
"Where we go for new resources is to look at how we can more efficiently use the existing budget allocations and I think there is a lot of scope for deregulation, cutting of red tape and improving purchasing power, possibly by having the sector purchasing collectively and possibly leveraging off government contracts."
Ms Dundas said the government's position was disappointing.
"We know that through ongoing demand for community services that people are really feeling the pinch financially," she said.
"We also know that we are turning people away, people who need our support."
Ms Dundas said the present funding levels was only allowing the sector to help struggling families and individuals who had reached crisis-point.
"The sector is working with families who are in dire straits and what we'd like to be doing is more of that early intervention work so that families don't reach the point where they're in crisis," she said.
"We're going to keep having these conversations because we as a community need to work out how we're going to continue to help those people who are most in need if it's not going to be with an increase in base funding."