Guide Dogs for the Blind announced drastic cuts yesterday with the closure of all its residential centres and the threat of 150 redundancies.
In common with many other voluntary organisations, the Guide Dogs for the Blind Association suffered huge losses on its stocks portfolio last year and overspent its £40m income by more than a third.
The charity, which has assets of £156m and last year received £24m through legacies, said it was seeking to reverse a decade-long annual overspend of £11m.
Nevertheless, it said that the decision to close its 15 training centres and replace them with 31 district teams was prompted both by financial requirements and a need to provide a more flexible service.
It said attendance at residential centres had fallen to 11 per cent because many people now preferred to be trained at home. "It is imperative that we keep pace with the changing needs of our service users whilst also securing our long-term financial future," said Geraldine Peacock, the association's chief executive.
The association said it would introduce the district teams as its centres were phased out over the next two years.
There will be a 90-day consultation period before the job losses are finalised. The cuts are expected to be among domestic cleaning, catering, administration, maintenance and kennel staff. Guide Dogs is solely dependent on donations and legacies and forecasts show that such income will decline. It would need to raise £5m a year until 2004 to correct its finances, the charity said.
In 1995 a select committee criticised Guide Dogs for sitting on vast amounts of money but not allocating it properly. Tony Searle, a spokesman, said: "We have a good cushion of reserves but we cannot continue indefinitely to have our expenditure outstripping our income.We have a lifetime commitment to our 4,800 guide dog users."