An award winning aged care mental health strategy will be shelved following a “bizarre” budget cut, according to the social workers behind the initiative.

The Grouplinks program has been supporting new residents and those with chronic diseases at a low care facility in Sydney’s north since 2008.

Last year the strategy picked up a Positive Living in Aged Care (PLAC) award and there were plans to expand the program into other facilities.

But in last week’s budget, the federal government announced it would stop providing Medicare payments for social workers and occupational therapists providing mental health services.

Grouplinks program coordinator, Cheryl Lasarow said the Grouplinks activities would be forced to end later this year when the PLAC prize money runs out.

“Our program was awarded with a prize and now they are saying it doesn’t warrant any funding,” said Ms Lasarow.

“It’s a bizarre cut because it didn’t affect the funding for psychologists. Psychologists fees are out of the reach of most people in aged care but social workers bulk bill their clients. We are also better trained in the specifics of aged care.”

“This group is not psychologically minded – they don’t like to just sit and answer questions about how they feel.”

The Grouplinks program supports residents who had, or were at risk of developing, depression and anxiety.

It is based on a series of confidential group sessions aimed at assisting residents to adjust to major life changes.

“We were independent of the facility and that’s why it worked,” Ms Lasarow said.

“You can’t just get one of nurses to run a group because the residents in these facilities are scared of rocking the boat – they don’t want to tell staff how they feel because they are afraid there are going to be repercussions if they speak their mind.”

But the government says it redistributed mental health funding in the budget based on advice from the mental health sector.

A statement from the Department of Health and Ageing said the government will provide care packages for up to 25,000 people diagnosed with severe mental illness.

“This is not a savings measure – in fact, the government will spend more overall on these programs,” the statement said.

“This means that people who are diagnosed with a severe mental illness will receive more coordinated care through a team of health professionals – including social workers and occupational therapists – to comprehensively look after their ongoing care needs.”

“This will deliver coordinated mental health care to those most in need in our community, rather than treatment on an ad-hoc basis.”