Bereaved families and lawyers are threatening to boycott the long-awaited inquests into the 1974 IRA Birmingham pub bombings because of concern over missing documents, lack of legal funding and what the process can deliver.

They are anxious that the inquest’s frame of reference has become so limited that it will yield little insight into the circumstances surrounding the two bombings that killed 21 people and wounded 220.

Compounding their concern is the lack of disclosure of vital evidence and the fact that key files that would have shed light on the explosions at Birmingham’s Mulberry Bush and Tavern in the Town pubs have disappeared.

On Friday, with the five-week inquest due to commence from 25 February, the law firm representing half of the families of bombing victims was told its application for a well-resourced legal team had been rejected. The Legal Aid Agency awarded the Northern Ireland firm KRW LAW LLP only a tenth of the funding it had requested for its 10 clients, leaving it dwarfed by the size and resources available to the publicly funded legal team of police officers and government officials.

On Saturday a crowdfunding page was set up in a late attempt to pay for greater legal representation. However, families have warned that crisis talks will take place this week over whether they will officially boycott the inquest.

Julie Hambleton, sister of one of the victims, 18-year-old Maxine Hambleton, said the legal funding decision was the latest in a series of demoralising developments.

“Something is seriously amiss, it’s absolutely outrageous. We are meant to have a judiciary system that is the envy of the world, but we’re going to be left with more questions than we started with,” said Hambleton.

Christopher Stanley of KRW said the integrity of the inquest was of serious concern to his clients.

He said: “We could walk away, we could boycott it. We could advise on that. We have discussed putting down tools because we have to act in the best interests of our clients. An intelligent person in their position might say: ‘What is the point in me engaging in this?’”

Families fear the hearings will focus primarily on the nature of the IRA warnings before the bombings and the response of the emergency services on the night of 21 November 1974. The coroner has already ruled out investigating whether an informer was embedded within the IRA cell responsible for the bombings after a pre-inquest hearing last month heard there was “no evidence” of a state agent involvement.

He has also infuriated families by excluding all evidence relating to the perpetrators. The Birmingham Six were wrongly jailed for 18 years over the bombings before proving their innocence. On Wednesday, the former Labour MP Chris Mullin identified two of the four men he alleged were responsible.

Stanley said: “If one of the purposes of complex multi-death inquests is to allay rumours and suspicion, then this will not.”

Disclosure is another vexed issue, with Hambleton “incredulous” that so far no police force or government department – including the Home Office, the Foreign Office and the Ministry of Defence, as well as MI5, MI6 and military intelligence – has said that it holds material relating to the atrocity.

Of particular concern are two folders belonging to the joint intelligence committee, examining information from the security services, GCHQ and military intelligence, which have gone missing and are understood to have contained “movements of the IRA”.

To date, 28,000 pages of evidence have been disclosed but lawyers and families are curious about the files they will not see.

“We know nothing, what search engine terms have been used or how many people are searching. We don’t know what the coroner has seen,” said Stanley. He is also worried that there has been no application for public interest immunity (PII), the legal device that means sensitive testimony is not made public in court to protect the national interest.

The lack of PII applications for the Birmingham inquest has raised predictions that no contentious testimony will be heard.

Also causing consternation is that despite the threat of an IRA bombing campaign at the time, no state agency appears to have produced any guidelines, policies or protocols on how to prevent or respond to a bomb threat or explosion. The lack of a policy may explain why, before the blasts, officers were sent to search empty offices in Birmingham’s Rotunda building above the Mulberry Bush but failed to evacuate the pub itself. Ten of the victims died in the pub and dozens more were seriously wounded.

“There were either no policies in place, or there were policies in place but they hadn’t trickled down. We would expect a file of protocols and policies from the Cabinet Office downwards,” said Stanley.

One option for the families, if they decide to boycott the inquest, would be to pursue a judge-led inquiry along the lines of the 2011 investigation by Sir William Gage into the death of Baha Mousa, who died in British army custody in Iraq.

Stanley said that they could consider folding the Birmingham inquest and the recently resumed inquest into the 1974 Guildford pub bombings, in which five people were killed.

The Birmingham pub bombings came at the height of the Troubles in Northern Ireland. Detonating at 8:17pm inside the Mulberry Bush and ten minutes later at the Tavern in the Town, the devices were planted during a concerted mainland bombing campaign by the IRA.

The month before the Birmingham attacks, October 1974, two pubs in Guildford, Surrey, were targeted and four British soldiers and one civilian killed by bombs left by the Provisional IRA.

Two weeks before the Birmingham bombings, a British soldier and a civilian were killed and 28 injured when the IRA threw a bomb through the window of the Kings Arms pub in Woolwich, England.

The year, 1974, culminated with the Provisional IRA announcing a Christmas ceasefire, but not before they carried out a bomb attack on the home of former Prime Minister Edward Heath, who was not injured. More than 3,500 people were killed during the Troubles, of whom 52% were civilians, 32% were members of the British security forces, and 16% were paramilitary group members.