In the overhaul, national funding, which is currently controlled by the agency, will be handed over to England's nine regional development agencies.
The funding includes money for programmes such as Wheels to Work, which provides young people with scooters to enable them to travel to find work (YPN, 30 June-6 July, p9).
The changes are part of a "ruthless streamlining" of rural agencies and funding, announced by environment secretary Margaret Beckett last week.
The changes do not affect money already allocated.
Bud Simpkin, national policy officer of the Rural Youth Network, said the change could jeopardise the rapport youth services have with the agency.
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