The UK's oldest environmental NGO has been forced to close after government cuts to local authority budgets drastically reduced its income.

Formed as the Coal Smoke Abatement Society at the end of the nineteenth century, Environmental Protection UK provided expert analysis on air quality and, more recently, contaminated land and waste issues. But over the past two years, the Brighton-based charity has faced severe financial challenges due to the coalition's cuts to local authorities, which purchase its products and services.

The closure comes as a report by the European Environment Agency said air pollution costs the UK up to €18bn a year, and an influential group of MPs warning the government is putting thousands of lives at risk due to the UK's failure to meet European air pollution standards.

Trustees announced on Monday that EPUK could no longer operate as a fully funded, staffed organisation, and that they will close it in March 2012. Ten staff will lose their jobs or take early redundancy.

Outgoing chief executive James Grugeon said: "Local authorities have been forced in the past year to make very difficult funding decisions, following severe cuts to their budgets imposed by central government. Within this economic environment, EPUK has faced an uphill battle to survive which, ultimately and despite our best efforts, we haven't been able to win."

Caroline Lucas, a vice president of EPUK and MP for Brighton Pavilion said: "I am deeply saddened that EPUK has fallen victim to the devastating coalition cuts being forced on local authorities. The closure of the UK's oldest environmental NGO is a serious blow to the green agenda, and to the ongoing campaign to tackle the UK's growing air quality crisis."

The charity said that despite its imminent closure it would continue to run its recently launched Healthy Air Campaign, which highlights air pollution's public health impacts, as well as provide services to members and honour its commitments to existing projects and partners.

Trustees are hoping to maintain a skeleton organisation run by a network of volunteers after next March. Meanwhile, EPUK'S Scottish division is looking at whether it could survive as a stand-alone body.