Leeds Jewish Welfare Board is fearing it will have to cut services after further funding cuts have been announced by Leeds City Council.

The charity, which runs elderly, mental health and disabilities care services, has already cut pay and hours for its 179 staff with one redundancy, following a 13.4 per cent cut in local authority funding for this financial year.

But last week Leeds council passed £55 million of budget savings for 2012-13, and has warned the Welfare Board that further funding reductions can be expected.

LJWB chief executive Rebecca Weinberg said there is a limit to the efficiencies the charity can make after restructuring its spending last April, and called on Jewish community donations to help plug the gap.

"The council initially told us cuts over four years will be loaded on the first year, but now they are saying that next year is going to be even worse.

"We thought we had made enough savings, but staff can't cope with more cuts. We can't continue without either prioritising which services will continue or seeing people increasing their contributions for services," she said.

She added: "Overall, we spent £3,437,372 last year. Leeds City Council is our main customer, and we received £1,654,955 in local government investment. This includes approx £500,000 in contracts for homecare services, £1 million in residential fees for people with learning disabilities and £88,000 in Supporting People contracts. We also had discretionary grants at around £150,000."

Ms Weinberg has had meetings with Leeds council to negotiate service contracts, which she said were "open and positive". The council has already awarded LJWB a contract to secure its home care workers at a reduced rate of £14.50 an hour. LJWB had rejected an earlier council demand to offer the service more cheaply after arguing it would compromise the service and pointing out it was half the cost of the council's own home care provision.

Councillor Keith Wakefield, Leader of Leeds City Council, said: "The scale of the challenge we face is massive. Government funding is being slashed at the same time that demand for services is rapidly increasing."