Manchester's major Jewish welfare charity, The Fed, is facing a £300,000 shortfall on its nursing care costs over the next year in the light of swingeing cuts proposed by its main funder.

Already trying to find £550,000 by 2020 to cover salary increases resulting from the implemenation of the National Living Wage, The Fed learned this week that Bury's Clinical Commissioning Group wants to slash its weekly contribution to nursing care from £750 to £557.48 per person for new clients. More than 80 per cent of nursing care clients at The Fed's Heathlands Village in Prestwich are from Bury. The shortfall forecast was £250,000 before the commissioning group's proposal.

Chief operating officer Mark Cunningham said The Fed was "trying to deal with a legacy of underfunding. This is the straw which breaks the camel's back.

"At a time when all our costs are going up, what needs to happen is that the National Health Service and local authority pay a realistic price.

"Bizarrely, the Bury CCG is suggesting that what they pay us should be reduced. How does that work in their world? Because they're not in the real world."

The new figure is £388 per week less than the true cost

The alternative to asking supporters for more money was "to insist that families pay a £388 per week top-up" to meet the actual cost of £945 per client.

"The £750 rate is the price that we've held for the past three-and-a-half years. That was not the true cost and obviously our costs have gone up in that time.If our nursing care unit was a business rather than a charity, we wouldn't now provide nursing care."

The Fed was in "an ongoing argument with Bury CCG, who have said people can find cheaper care in and around the borough". Mr Cunnigham warned that the cuts were "a false economy", as some of those requiring care would use NHS facilities instead. "Conservatively, an NHS hospital bed costs anywhere between £800 and £1,200 a night," he pointed out.

"A lot of nursing providers will cease to exist because they can't afford to employ nurses. And when there are no beds in care homes, people will end up in hospital and the hospital beds will get blocked up."