The Ministry of Social Development is critical of Kidicorp for publicly requesting more funding when many of its applications are still being assessed.
Kidicorp owner Wayne Wright says the private pre-school and after-school programme operator is facing a loss of $400,000 this year, unless the ministry intervenes.
Because of contestable funding, he claims there's no guarantee Kidicorp's current programmes will continue to be funded.
The ministry says it's essential to adopt a rigorous approach when considering funding requests.
Deputy chief executive Patricia Reade says it has not rejected any applications from Kidicorp and encourages the company to contact the ministry directly if it has have any further concerns.