Dublin's social housing programme is facing a cut of €20m next year, which councillors say will halt any new projects.
The Council's housing committee heard that the Department of the Environment have warned Council officials of the cutback that would amount to 10% of the total social housing budget.
Assistant City Manager Ciaran McNamara informed councillors of the proposed cutback after being criticised for lack of progress in restarting the regeneration of St Michael's estate, O'Devaney Gardens and Dominick Street flat complexes.
He said the department had also instructed the council to keep €20m of their remaining budget for regeneration projects.
Labour councillor Kevin Humphries said there are 5,300 families on the city's housing list who are now facing a worse crisis.
The committee agreed that they will request a meeting with the department to try and stop the cutback going ahead.