A charity which has spent ten years helping homeless people has revealed it can no longer survive and will be forced to close in less than two months.

Staff at the Birmingham-based National Rent Deposit Forum (NRDF) have been forced to end services after failing to secure funding.

Set up in 1995 the NRDF built a strong nationwide network of 250 members and remains the only organisation giving specialised support and advice to rent deposit schemes.

Over ten years the NRDF advised thousands of clients, supported hundreds of schemes, provided tailored training to housing workers and campaigned on housing issues.

Rent deposit schemes house homeless people in private rented properties and support them in tenancies. Each project acts as an intermediary between tenant and landlord, offering a legal guarantee, or cash, to pay for rent in advance, rent arrears, theft or damage.

The NRDF estimates its members house 14,000 people a year, with 8,500 landlords.

Charity chiefs are blaming the crisis on an increase in demand from local authorities looking to put homeless people in private rented accommodation.

Karen Dick, chair of the NRDF National Executive Committee, said: "We are bitterly disappointed an organisation that has driven up standards, influenced policy and legislation and offered a quality service to rent deposit schemes is having to close its doors - especially at a time when legislation nationally is recognising the need to incorporate rent deposit schemes in meeting housing need. The loss of the NRDF will have a major impact."

The growth of rent deposit schemes has been encouraged by the Government who have advocated using the private rented sector to tackle homelessness.

In their policy briefing, "Providing More Settled Homes", published in June 2005 the Office of the Deputy Prime Minister (ODPM) said: "We are encouraging local authorities to consider rent deposits, guarantees or rent in advance to help households."

Recent research commissioned by Crisis also supports the practice of rent deposit schemes but criticised the Government saying "they have not matched the strong lead in Scotland and Wales".

The report goes on to state "there is also a case for the ODPM to fund a national advisory service".

Despite the evidence supporting the practice of rent deposit schemes and the research recommending a national advisory service, the ODPM has refused to provide financial support.

The NRDF are receiving an increase in demand from local authorities but with no financial support.

Today charity chiefs vowed to continue to lobby the Government for financial support until close of business, expected on April 30.

Members, supporters and friends of the NRDF are bitterly disappointed.

A spokesman for the Spear homeless shelter, Chris Imrie, said: "This is a terrible development.

"For more than ten years the NRDF has been an invaluable source of information to those people who have seen the need for setting up a scheme locally to meet the housing needs of individuals in their area.

"At this time when central and local government both stress the importance of increased use of the private rented sector to meet housing needs and obligations, it seems very short-sighted not to fund this essential organisation, which provides support to schemes and provides a national umbrella group for members, and which also conducts valued research which has had an impact upon recent social policy."

* People across the country are now being urged to add their voice to the campaign to get funding from the ODPM by logging on to www.nrdf.org.uk or emailing their comments to infonrdf.org.uk The NRDF will compile all responses and present them to the ODPM.