The Castlemilk Youth Complex, which works with about 500 young people every year, is threatened by changes to the way Government money is assigned to the deprived areas of Scotland.
The money was previously allocated through Social Inclusion Partnerships but will now be delivered through multi-agency Community Planning Partnerships (CPPs). Castlemilk believes it will not receive funds from Glasgow CPP. It faces a shortfall of between 200,000 and 300,000 for 2006.
A spokesman for Communities First, the Government body that supports deprived areas in Scotland, said: "The funds are there. Castlemilk must talk to the CPP and convince it that what it is doing is going to create successful work."
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