Controversial housing plans, which charities warned could force thousands of women, children and refugees onto the streets, have been abandoned by the government. 

Ministers announced on Thursday that plans to pull funding for short-term housing providers, such as refuges, and instead give local authorities the power to commission these services, would not got ahead. 

The proposal had sparked strong opposition from charities, with leaders arguing the “life-threatening” change would destabilise the entire sector, and force some refuges to “close their doors forever”.

Women’s Aid warned the move would shut down almost 40% of its services, leaving more than 4,000 domestic abuse victims – including children – with nowhere to turn each year.

In a statement announcing the government’s decision, housing minister Kit Malthouse said that the case for keeping supported housing in the welfare system became clear after consultations with the sector.

“Protection of the most vulnerable has always been our primary concern,” he said.

“The sector also recognised that our aim of improving the quality of homes must be addressed and we look forward to now working with partners to make sure we have strong measures in place.”

Charity leaders have celebrated the move, with chief executive of the National Housing Federation, David Orr, saying it would end “years of uncertainty”. 

“This announcement means that hundreds of thousands of people, many of whom are vulnerable, will continue to receive the support they need by right, through the social security system. It gives them the certainty and security they need and deserve.”

Women’s Aid chief executive, Katie Ghose, said: “Domestic abuse refuges save lives. With on average two women every week being killed by a current or former partner in England and Wales, refuges provide a real lifeline for thousands of women and children experiencing abuse at home.”

She added: “We look forward to working with the government and our member services to deliver a robust system of national oversight for life-saving refuges.

“By working together, we can guarantee a long-term, sustainable funding future for all domestic abuse services to ensure that every woman and child can get the help they need to rebuild their life free from fear and abuse, not just for today but for life.”