Increasing costs had led to some difficult decisions, Minister for Disability Issues Louise Upston said.
This included reducing some aspects of flexibility for purchasing rules, which happened "alongside the very urgent need to ensure the [Ministry of Disabled People — Whaikaha] could continue to fund critical equipment and modification services".
The government provided additional funding for the ministry to make up for the deficit in the disability support system in the financial year just completed, Ms Upston said.
Ms Upston wrote to Dunedin Mayor Jules Radich last month after he had written to her on behalf of the council in May.
Her letter came up at a council meeting last week, prompting the Otago Daily Times to request a copy.
"Demand for disability support services is increasing and the cost of delivering those services is also increasing year on year", she wrote.
"The ministry has work to do to ensure it can continue to provide disability [support] in an affordable and equitable way."
Mr Radich wrote to Ms Upston after a notice of motion put up by Cr Mandy Mayhem was passed by the council.
The new restrictions had removed mileage allowances, cut accommodation support, reduced purchases and forced changes to equipment and home-modification priorities — all of which were previously a life-saver for disabled individuals and their families, Cr Mayhem said at the council meeting.
Cr Carmen Houlahan said at the meeting the changes to purchasing rules had "put fear into every member of the disability community".
The issue was personal for her, as she had a son with disability needs.
Ms Upston referred to a review that had been announced.
It is expected to advise on pressure the disability support system is under and provide recommendations about how services could be sustained in the long term.
