Cardiff Council plans to cut its grants to charities by 17 per cent in the next financial year, and move towards a commissioning procurement basis for service-delivery charities, following a review of its grantmaking process.

More than 70 organisations will have grants stopped and five equality and infrastructure bodies will see their budgets cut by 10 per cent under the proposals, which will save the council £452,380.

Last year the council provided £2.7m in grants to the voluntary sector. The council is facing a budget deficit of £33m for 2014/15 and announced last February it would carry out a review of grant funding.

The report, which assessed 123 separate grants awarded to 94 organisations, found that: “A significant amount of grant funding is going to organisations that are providing key services outside of any commissioning or procurement process. However in some cases it has been difficult to identify the rationale for decisions made many years ago.”

Arts and culture organisations are facing the biggest cuts in funding, with 14 organisations set to lose out when the council scraps £220,000 worth of grants and replaces it with a £71,896 fund for “specific, discrete projects”.

The review has divided grants that deliver key services into three areas: care, support and education; advice and homelessness prevention, and intervention. Together these total £1.25m. It proposes to protect funding levels to those organisations for the next year, while it implements a commissioning and procurement system for the future.

Grants to four infrastructure and equality organisations (Cardiff Third Sector Council, Voluntary Community Services, Race Equality First and Diverse Cymru) will be reduced by 10 per cent and the council is encouraging the organisations to work together.

Cabinet member for communities, housing and social justice, councillor Lynda Thorne said: “Following the review, the resulting proposals would provide more stability and create a greater opportunity for a wider range of third sector partners to deliver innovative schemes across the city.”

The proposals have been issued for consultation and the final decisions will form part of the council’s budget to be announced in February 2014.