Thousands of disabled people will suffer when a welfare service is axed because of council cash cuts.

East Sussex Disability Association is furious the county council has pulled the plug on funding for its welfare rights service.

The service supports disabled people make claims for their full legal entitlement to state benefits. It will be forced to close in September if no extra cash is found.

The news comes days after users of a day centre in Newhaven had their 80p nominal daily wage axed by social services bosses in East Sussex to save £60,000.

The latest blow has been described by campaigners as "having a very damaging impact" on disabled people.

Andrew Bruce, chairman of the association, said: "The benefits system is large, intimidating and complicated and national and local statistics show that disabled people do not claim the benefits they are entitled to.

"The welfare rights service takes people from the first stages of trying to claim benefit up to the level of legally challenging Benefits Agency decisions."

He said the service was launched in May 2000, with a pledge of continued funding from East Sussex County Council.

But he said: "The funding for our welfare rights service has been removed by East Sussex County Council. If no new funding is found, the service will close in September.

"This will have a very damaging impact on local disabled people, many of whom look to us for practical support and advice."

He said more than 700 people have been helped through casework and telephone advice in the first nine months.

Bert Massie, chairman of the Disability Rights Commission, said: "It really does not add up. Funders may save some £20,000 by cutting a benefits advice post. They do not seem to realise that what they are doing is cutting off £1 million worth of benefit coming into the local economy direct from the Treasury."

One of the service's users, Tracey Thomson, who has a disabled son, said: "I cannot believe this service will not be there, it is an absolute outrage they have not got funding.

"It has made such a difference to us. Before coming here I had no idea what we were entitled to. It was a fight but we now get all the benefits we are entitled to."

The association's services include direct payments advice and support and a comprehensive information service which has dealt with more than 1,000 calls in the last year.

An East Sussex County Council spokeswoman said: "The welfare disability rights service was funded through the Promoting Independence grants from Central Government and administered by East Sussex County Council's social services.

"This year, the grant was reduced by £490,000. Therefore the social services committee reluctantly had to make decisions as to where priorities must lie.

"These focussed on supporting schemes providing direct services to vulnerable people in the county.

"However, social services managers are working with the association to identify alternative sources of funding so that the scheme can continue and while all alternative avenues are being explored, additional funding has been made available to enable the scheme to continue beyond its expected closure in May."