David Ross' comments came following Tuesday's housing and communities committee meeting, when it was revealed that next year's grant from the Annual Housing Investment Program (AHIP) – which funds affordable housing through housing associations – would drop from £16.9m to £9.2m

Calling the cut "disastrous", Cllr Ross added: ""We were braced for a cut in the grant following the SNP Scottish Government's decision to cut £200m from the housing budget across Scotland – but no-one expected anything like this."

"I believe the Government's decision is very short sighted.

''This will hit all those waiting for housing in Fife and across the rest of Scotland.

''It will also be another blow for the building industry and will cost more local jobs."

"And once again Fife seems to have suffered more than other parts of Scotland."

Cllr Ross said he would be calling on the Council to challenge the cuts and will ask local MSPs to raise the matter in the Scottish Parliament.

Derek Muir, the head of housing and neighbourhood services, also confirmed Fife Council would appeal to the Scottish Government to try to get some of the funding reinstated.

He said: "We are concerned at the drop in funding levels and we are taking the matter up with the Scottish Government.

''Essentially we feel we have very strong case for affordable housing investment in Fife, and the primary funder is the Scottish Government.

"It's a very large drop. As an authority we have a housing need that is being assessed as over 500 new affordable homes each year, every year.

''We have depended on AHIP to support 240 properties every year in recent years.

''This means our capacity will drop to about 120 properties next year.

"It's quite a reduction in the number of affordable houses that can be brought on stream in Fife."

Mr Muir also said the local authority was looking at other ways of supporting affordable housing, such as working with the private sector and the continued development of their own programmes.