Chancellor George Osborne has been asked to personally intervene to save 150 jobs at Tameside social housing provider, New Charter.
And Ashton-under-Lyne MP Angela Rayner is also demanding an urgent meeting with the Housing Minister Brandon Lewis, New Charter chief exec Ian Munro and trade unions to discuss the job losses.
Meanwhile Mr Osborne faces angry demands to re-think rent cuts of 1 per cent every year for the next four years, which has been blamed for the redundancies.
Ashton-under-Lyne Labour MP Angela Rayner said: "George Osborne is to blame for these jobs losses because he has insisted on rent cuts for the next four years.
"As a result, New Charter and every other housing association in the country is being forced to cut services to their tenants and with them, thousands of jobs because of this sudden loss of income.
"I am extremely concerned at these job losses and will do whatever I can to help New Charter and its staff who are the innocent victims of this.
"It is a very worrying new development in how the Government treats housing associations and I want the Housing Minister to urgently sit around the table with everyone involved so that he can hear about the impact of Government policies.
"I am also writing to Mr Osborne, demanding that he reverse this policy.
"He needs to take full responsibility for these job losses in my constituency - it is his Government which has ordered rent reductions to slash the housing benefit bill.
"He has shown no thought for the consequences, the jobs lost and the services to tenants which will be drastically cut as housing associations like New Charter try to balance their budgets.
"It is Government by diktat and an attack on social housing providers when Britain faces a massive shortage of housing, especially for young people.
"On top of the Governments's new 'right to buy' legislation which will cut the number of affordable homes available, it means many social housing organisations up and down the country will face huge challenges in keeping their businesses going, when they should be building more homes to meet the increasing need."
Mrs Rayner has also tabled a Parliamentary Question to the Housing Minister, branding Government policy as 'ill thought through' and opposing the 'right to buy' scheme along with unfunded rent reductions.