Under current government plans, the "formula grant" that councils receive from central government for almost all child protection and care services will be scrapped, with councils instead raising the money for services themselves from local business rates and income tax.
Children England, a membership organisation for children's charities, has warned that while the new system may benefit prosperous areas, it could increase pressure on services at already hard-pressed local authorities in more deprived areas.
"For the poorest areas, already hit hardest by the cuts, this means even more pressure on local people and businesses and dangerous compromises in children's care and protection," a briefing paper put together by Children England states.
"Wealthier areas, less impacted by cuts and able to raise more from local businesses and council taxes, will find it comparatively easier to continue protecting their children," it adds.
Councils have been faced with significant cuts in funding in recent years. In May the Local Government Association (LGA) warned children's social care is facing a £2bn black hole.
Children England chief executive Kathy Evans said the organisation is keen to raise awareness of the future funding because knowledge of the changes, even among children's services practitioners, is low.
She said there was is "a systemic problem with the plan to leave the poorest areas in the country with the lowest chance of raising their own income".
"There's a big issue for how the general taxation collected by the exchequer is not going to come back out to council children's services in the future," she said.
The change in funding policy was included in the 2016/17 local government finance settlement.
Upon its publication in February 2016, former communities and local government secretary Greg Clark said revenue support grant, by which the formula grant is also known, would disappear in a move towards "100 per cent business rates retention".
Evans said: "It has this narrative that it's about encouraging councils to stand on their own two feet.
"But the money collected at the exchequer for income tax and corporation tax should still be coming out to children based on those in most need."
The government is currently reducing the revenue support grant in stages until it no longer provides the funding by 2020.