Britain's poet laureate has accused the government of behaving like "scrooge at his worst" after ministers decided to axe all funding for a free book scheme that benefits 3.3 million youngsters a year.

Carol Ann Duffy, who was appointed poet laureate in 2009, leads a series of writers who have attacked the decision to cut all government funding for the Booktrust charity which provides free books for children from the age of nine months until their first term of secondary school when they are 11.

Duffy said: "Support for Bookstart is support for the dreams and imaginations and futures of British children. To withdraw that support is to behave like Scrooge at his worst. Here's hoping the powers- that- be see the light in tiime, as he did."

Duffy was joined by the best selling novelist Ian McEwan. The author of Atonement said: "I'm appalled to hear that Bookstart is for the chop and I'm counting on Michael Gove to reconsider. This modestly funded, truly civilised scheme has brought to millions of kids benefits far beyond the calculations of politicians. Who knows what seeds have been planted in young minds? It's by initiatives like this that we hope to measure ourselves as a mature and thoughtful society. A U-turn on this would be an honourable choice."

Children's author Philip Pullman attacked the move as an "unforgivable disgrace", while the former poet laureate Sir Andrew Motion described the cut as "an act of gross cultural vandalism".

These uncompromising views were echoed by Viv Bird, chief executive of the Booktrust charity, who said she was "astounded and appalled" when told all government support for their work was going to be scrapped. "There was no dialogue. It was completely devastating," she said.

The Booktrust charity runs several programmes that together provide free books for children from the age of nine months until their first term of secondary school when they are 11, and is widely admired by teachers, parents and authors.

They began as a pilot project in 1992 but were awarded government funding in 2004 to become universal. But 10 days ago – despite having previously offered to take a 20% funding cut – the charity was told it was to lose 100% of its £13m-a-year government grant.

The literary world has reacted with horror and has begun a campaign that has echoes of the one launched against the decision of Michael Gove, the education secretary, to axe funding for school sport, a plan revealed in the Observer. In fact, the decision to end Booktrust's funding is thought to have been taken to finance the education secretary's eventual U-turn on sport, which saw much of the threatened £162m cash for school sport partnerships restored.

The reaction by authors to Gove's latest move has been furious. "It's like seeing someone smashing aside a butterfly with the back of their hand: wanton destruction," said Pullman. "Sheer stupid vandalism, like smashing champagne bottles as a drunken undergraduate. It doesn't matter: someone else will clear it up. Well, if you miss the first years of a child's development, nothing can clear it up. It's gone. It won't happen. A whole generation will lose out."

Referring to the charity's early years programme aimed at babies, he said: "Bookstart is one of the most imaginative and generous schemes ever conceived. To put a gift of books into the hands of newborn children and their parents is to help open the door into the great treasury of reading, which is the inheritance of every one of us, and the only road to improvement and development and intellectual delight in every field of life."

Motion backed these words: "The decision to scrap Bookstart is an act of gross cultural vandalism. For the last 20-odd years the scheme has successfully introduced an enormous number of young people to both the pleasure and the necessity of reading and has been of tremendous benefit in the drive towards literacy. Very well organised, and very well run by Booktrust, it has become a national institution, and the envy of the world [24 other countries now run a similar scheme].

"The savings made by its abolition will be negligible; the damage done will be immense," Motion added.

Nicholas Tucker, author of the Rough Guide to Children's Books, and a leading academic in children's literature, said reading for pleasure was the best way of making sure reading skills acquired when young were retained and improved. "With a survey last week showing that one in 11 boys leave primary school unable to read at all, this is no time to let up on a scheme that has already enthused so many parents, teachers and children in the vital area of development."

Bird also questioned whether Lib Dem leader Nick Clegg had backed the move. "I would be interested in Clegg's response," she said. "He was a great champion of Bookstart but he's gone quiet. I would like to know if he's still going to support us."

By contrast, Labour leader Ed Miliband was forthright in his condemnation. "Bookstart has been proved to make a difference to the lives of kids up and down this country and is now being copied round the world. This is a small-minded, high-handed and nasty decision."

Richard Holmes, biographer of Coleridge and Shelley, joined the criticism. He said: "One of my earliest memories is of my mother sitting under a Victorian standard lamp with curious golden fringes, reading the poems of Robert Louis Stevenson to me, while the rain beat in gusts on my bedroom window. I think my feeling that life is some sort of mysterious adventure, which I still feel after 60 years, began with those three things: the rain, the poems, and my mother softly reading under a golden palm tree. That is why I support the brilliant, magical idea of Bookstart."

Last night there were signs that Gove was preparing to execute another partial U-turn. While insisting the full £13m cut would still go ahead next year, sources said ministers were keen to negotiate another contract to ensure some free books could still go to poorer children.

An earlier statement from the Department for Education made no mention of continuing any part of the scheme. "We believe that homes should be places that inspire a love of books and reading," said a spokesman. "While we appreciate that some families will need to be supported if they are to provide this kind of environment, in these difficult economic times ministers have to take tough decisions on spending."

But on Boxing Day the education department and Booktrust released a joint statement: "[We] are determined to ensure that reading for pleasure is a gift every child can enjoy. That is why the DFE will continue to fund Booktrust book-gifting programmes in the future."

"Although the current contract will end in April the Department is talking to Booktrust about how to develop a new programme which will ensure that every child can enjoy the gift of books at crucial moments in their lives while ensuring we develop an even more effective way of supporting the most disadvantaged families to read together. The Department and Booktrust will be working together, with publishers, in order to ensure that we can make every possible saving in developing an enhanced programme."