NHS bosses are under fire for cutting back a team of doctors and nurses who provide mental health care to one of Britain’s largest groups of homeless people.

Camden NHS Clinical Commissioning Group (CCG) in north London is giving the Focus Homeless Outreach team £219,866 less a year starting on 1 April, a leaked CCG document reveals. One of the team’s two psychiatrists and one of its six nurses will lose their jobs as a result.

Critics say the decision makes a mockery of Theresa May and Jeremy Hunt’s repeated claims that NHS mental health services are receiving record amounts of funding to improve care. They fear it will lead to more rough sleepers suffering mental health crises and killing themselves, and that it will add to the already heavy demand for care being faced by hospitals and GPs in Camden.

The CCG is pressing ahead with the 42% cut to the £521,000 budget it gave the team this year despite a storm of protest from local GPs, psychiatrists, homeless charities and managers of hostels where rough sleepers sometimes stay. Camden had the third highest rate of rough sleeping in England in 2017, recent government statistics showed – more than Manchester, Bristol and Cornwall.

Focus, set up 25 years ago, helps treat the high levels of depression, psychosis and other mental health conditions found in rough sleepers, hostel dwellers and “sofa surfers”, including some asylum seekers and people who have been trafficked. Its budget is being reduced even though it is regarded by NHS, local council and social work bosses in London as a model of good practice of how to reach the kind of group that often shuns traditional NHS services.

Consultant psychiatrists at Camden and Islington NHS trust have privately criticised cutting Focus’s budget as a “terrible” blow to a “priceless” service. “Yes, there are unprecedented financial challenges, but it’s pretty appalling that a vulnerable and voiceless group would be left so unsupported,” said one.

Another said: “I find the decision extremely hard to understand, given the high number of homeless people in Camden. Without the Focus team, some of the worst-off members of society will lack proper access to psychiatric care.” Another warned that untreated mental health problems could also potentially lead to incidents of crime and violence.

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Family doctors at Camden Health Improvement Practice, a GP surgery near Euston station which treats homeless people’s physical health needs, have told the CCG in a letter that they are in a state of disbelief about Focus’s budget cut. It gives essential mental health support to homeless people when they are arrested or admitted to hospital as an emergency, they said.

Prof Roland Littlewood, an emeritus professor of psychiatry at University College London who used to work with Focus, said: “The proposed cuts cannot be clinically justified and I would consider them quite dangerous. When we in the future contemplate the increased number of preventable deaths in the service, it will be too late.

“If May and Hunt are promising increased support for mental health services, then where is it? The homeless are the most vulnerable to declining social and medical support.”

Camden CCG originally planned to cut £421,000 (81%) of its funding to the team to help meet its savings target under the NHS-wide Quality, Innovation, Productivity and Prevention plan, but reduced that to £219,866 after opposition. It claims other services will provide support for the work Focus can no longer do, but failed to provide any details.

Senior figures at University College Hospital in Camden are worried that limiting Focus’s work will lead to more rough sleepers turning up at its A&E in a state of mental health crisis.

Saffron Cordery, deputy chief executive of NHS Providers, which represents NHS trusts, praised national health service leaders for giving mental health greater priority. But, she added, Camden CCG’s decision “confirms once again what mental health trust leaders have been telling us about the growing gap between the government’s welcome ambition for the care of people with mental health needs and the substantial challenges facing core mental health services.

“Money earmarked for mental health is not consistently reaching the frontline. It is particularly important that vulnerable people such as the homeless are able to access mental health services.”

Camden CCG said: “Due to significant financial challenges, the NHS is having to make difficult decisions and it has been necessary to reduce funding of the Focus homeless service. Camden CCG have worked with Camden & Islington NHS Foundation Trust to reconfigure the service so that it dedicates it efforts to helping those with the most complex needs. Those with less complex needs will be signposted to other suitable health and care services in Camden.”