Jewish charities have been hit by a huge drop in donations this year and may have to make further cuts as local authorities, which use their services, tighten their belts.

Norwood, whose services for children and families in need are mostly purchased by local authorities, has been warned by councils that it must significantly reduce its fees or the councils will not continue to buy its services.

Norwood's chief executive Norma Brier said: "Obviously we do want to continue to work with local authorities because they are 75 per cent of our business, and whatever happens we want to continue to run our services which are a lifeline for so many people. We must make prudent, sensible reductions, but we won't know what they will be until we go to consultation in October."

She added: "This is what David Cameron means by the Big Society - we are going to be more reliant than ever on the generosity of the community, or the most vulnerable will suffer."

UJIA is making 15 redundancies as part of a drive to make £400,000 worth of cuts after a dramatic fall in donations - £11.7 million last year compared to £14.45 million in 2008. However, the charity's chief executive Douglas Krikler said it would not affect the projects currently running in the UK and Israel.

JNF may consider closing its regional offices in Manchester, Leeds, Liverpool and Birmingham, but chief executive Elliot Conway has previously said no final decision has been made.

World Jewish Relief must raise £280,000 by the end of the month to avoid making cuts in its international welfare programmes. Its work in Ukraine has been particularly hit by the falling value of sterling against the Ukrainian currency, the hryvina.

Paul Stein, director of fundraising, said: "WJR's programmes, like many charities', have been affected by external factors and the ongoing global financial crisis. It is the impact of these uncontrollable global forces that threaten our projects. The cost of providing even basic food supplies has greatly increased."

Recent research by Investec Bank has shown that donations to charities are down 9.6 per cent from last year. The north-west is the region which has seen the biggest drop of 14.8 per cent. UJIA has already cut four jobs in its Manchester office.

The research showed that across the country, 10.74 million people have reduced their charitable donations.