New York (CNN) — President Donald Trump’s $1 billion plan to cut funding for Pell grants, a government program for low-income students, would slash federal funding for state and local programs that provide help to low- and moderate-income families, the New York City-based newspaper The Times said Tuesday.

The proposal would eliminate Pell grants for those who are on the brink of financial difficulty, reduce Pell aid to students who are not working or who are in school less than 30 percent of the time, and redirect $1,000 a year to state-funded programs, the newspaper reported.

The plan also calls for a new program called Temporary Assistance for Needy Families to provide $1 million to states to help low- to moderate-wage families afford housing.

The proposal would increase that funding to $2.3 million.

The cuts are a major blow to the $17.3 billion federal Pell grant program, which provides aid to nearly 4 million students and their families.

More than half of all low-wage earners received Pell grants in fiscal year 2018.

The proposed cuts, which were first reported by the Wall Street Journal, come on top of an additional $8.7 billion cut proposed in the fiscal 2018 budget to the Department of Education.

The cuts would take effect in 2021.

In a statement to CNN, the Education Department said that while Pell grant programs are a vital part of America’s social fabric, they must not be sacrificed for the sake of a political agenda.

The budget proposal comes as Democrats and civil rights groups have accused the administration of stifling the growth of higher education in order to boost the popularity of President Donald Trumps Republican Party.