A South Australian council says it has been caught short by a change in federal government, which has deprived the town of approved Regional Development funding.

The Port Lincoln Council says it had Regional Development Australia (RDA) money approved by the former federal government, but it is now concerned the current government will not honour it.

The Labor party says about 700 projects will lose money nationwide.

Some reports say the Coalition Government has agreed to continue projects whose contracts were signed-off, but non-contracted announcements will be re-assessed.

Port Lincoln councillor Faye Davis says the concerns come from the often considerable cost of compiling a successful submission.

The issue will be raised with the SA Local Government Association, following a motion by Cr Davis.

Port Lincoln Councillor Michael Bascombe disagreed, saying the council should be more concerned with other wastage in the system, such as employing people just to apply for grants.