Mike King says the Ministry of Health (MoH) has rejected funding pleas for Gumboot Friday funding to provide free counselling for young people.
In an Instagram post on Thursday morning King, a prominent mental health campaigner who founded Gumboot Friday, said he'd received a letter saying the MoH "wasn't in a position" to fund the service.
King, who last month returned his New Zealand Order of Merit medal in protest against the state of New Zealand's mental health services, says it's devastating.
"Despite this rejection, we vow to continue fighting to fund free counselling for the kids MoH doesn't care about.
"Sadly this will have a devastating effect on Kiwi families who are already being pushed out the doors of our overrun mental health services."
King said it was a "truly sad day" for New Zealand. It comes after a Newshub report last week revealed that despite the Government's applauded mental health investment in 2019, just five extra acute beds have been added over almost two years.
The MoH came under fire after it was revealed just 0.2 percent of $235 million set aside for building mental health and addiction facilities, part of a $1.9 billion mental health package announced in 2019, had actually been spent.
Health Minister Andrew Little subsequently ordered a review and claimed on Monday more had been spent than what was previously reported.
"Of the $235 million for building or seriously upgrading five acute facilities that are in desperate need of it, actually, a lot more than the 0.2 percent has been spent - about $9 million actually," he told The Hui.
"Construction for none of them was due to begin until next year - $9 million has been spent on the planning, the consenting, and getting things ready, so that stuff is happening."
Asked about expanding mental health services such as Gumboot Friday, which provides free counselling to five to 24-year-olds, Little said there were several requirements professionals had to meet before they could see children, even though that may seem "bureaucratic". That's despite King saying all of Gumboot Friday's counsellors having a practising certificate.
"Children are too vulnerable to allow just anybody to deal with them on a personal basis," Little said.
In a statement, MoH sector support and infrastructure deputy chief executive Robyn Shearer confirmed the ministry was unable to fund Gumboot Friday, nor any other charity or service at this time.
"The application from Gumboot Friday representatives was unfortunately sent outside the planned procurement processes.
"Procurement rules are designed to make sure there is a transparent, fair and equitable process, and to make sure there can be robust evaluation of applications.
"In its email to Gumboot Friday representatives yesterday, the ministry thanked them for their passion and commitment to the mental health and wellbeing of young people across New Zealand. 'We understand that there is a huge need for increased mental health and addiction supports across the country and while we have made progress over the last two years there is more work to be done. We share your passion and commitment for this work and are working hard to put in place the transformation that we all know is needed,' the email said."