It is feared that the decision will jeopardise the future of more than 100 addiction projects when local authorities take over the hostel costs next year.
In April 1993 as part of the community care reforms, set out in the NHS and Community Care Act 1990, money from the social security budget will move to local authorities. Addiction organisations have estimated that about pounds 20m a year is paid by social security departments to addicts attending treatment centres to pay for their residential costs.
A separate grant of pounds 2.1m in the current year for drug and alcohol treatments will continue to be protected, it is understood.
Although no sums of money were committed, two years ago Kenneth Clarke, as Secretary of State for Health, said that the money would be earmarked to ensure that local authority social services departments did not use it for other services.
Eric Appleby, director of Alcohol Concern, said yesterday: 'This is just what is now likely to happen.' Addiction treatment was in peril because it was not a vote- winner in local politics and because there was no statutory requirement on local authorities to provide it, he said.
A further complication is that addiction services are nationwide. This means that people seeking treatment are regularly referred to units outside their own local authority. Mr Appleby said: 'If they maintain the pounds 2.1m grant for drug and alcohol projects as specific money, I think they can get away with it. Local authorities are already saying that the total money to be transferred to them is pounds 150m too little. Drug and alcohol projects are going to be a long way down the list of priorities.'
Under the new arrangements local authorities in England will receive pounds 539m next year to provide care for vulnerable groups including the elderly and disabled. Of this, pounds 399m will transfer from the social security budget. Earlier this month Virginia Bottomley, Secretary of State for Health, agreed to protect or 'ring-fence' community care money.
A spokesman for the Department of Health confirmed yesterday that transferred money for addiction hostel costs would not be specifically earmarked. Instead it would sink into a pool of money set aside for community care.
He said: 'Mr Clarke made his announcement when it was not the intention of the Government to 'ring fence' a total amount for community care. We believe it is better to leave it to local authorities' discretion as to what services they will provide.'