Hundreds of charities and community groups are facing an uncertain future and say they are heading for a funding crisis as the Government runs the ruler over its contracts.
The Government hopes to have New Zealand smoke free by 2015, but after 20 years of working towards that goal the Smokefree Coalition won't be there to see it.
The Ministry of Health has cancelled the charity's funding, forcing the coalition to close its doors.
Two weeks from now, some 750 organisations will also see their contracts expire, and not all will be renewed.
"They are wanting a focus on quitting alone they don't want to fund organisations like Smokefree Coalition who has been probably a thorn in their side probably pushing them to increase tax, to try and get this plain packaging legislation through," Jan Pearson of the Smokefree Coalition said.
Charities, volunteer groups and non-government organisations (NGOs) believe they are in crisis after funding cuts, largely from the Ministry of Health and Ministry of Social Development.
"There are organisations - two weeks before the end of the financial year - who are still uncertain about their lease obligations, are they going to be able to afford it?" Scott Miller said.
Mr Miller represents charities and NGOs and said smaller ones will be edged out by bigger organisations, some of which work for a profit.
"It's a deconstruction of our sector piece by piece. It's a really unfortunate position where these organisations that are generally the glue of communities are being disestablished."
However, the Ministry of Social Development said it spends $330 million on these organisations and is not cutting funding.
"I don't accept that the sector is in crisis," MSD chief executive Murray Edridge said.
"There are a lot of organisations that feel that the money they get isn't sufficient - part of the model of the strategy is how do we fund better and more cohesively going forward? Are there some providers that will close their doors? Inevitably that's the case."
While the Ministry of Health said not enough people are quitting smoking and wants a better value service.