The program has been caught up in months of bickering between the state and federal governments over who should provide funding.

The state government has released an independent report recommending the program be dissolved and its funding diverted.

The KPMG report cited problems with the program including trouble meeting its aim of short-term care at late notice.

The report suggests funding instead be shifted to the underused Adult Community and Further Education subsidy, assisting parents with childcare while undertaking education and training.

But Kyneton Community and Learning Centre childcare co-ordinator Joanne Woodman said people using childcare were not necessarily in further education.

"There is a minority studying, but the majority are [using the service for] just that, to take a break."

Children and Early Childhood Development Minister Wendy Lovell said the program was being inappropriately used to address gaps in general childcare services.

Jamila Rizvi, a spokeswoman for federal Early Childhood and Childcare Minister Kate Ellis, said the Baillieu government should follow the lead of other states in committing funding for this type of childcare.

"The federal government also funds an unlimited number of childcare places in Victoria in long day care, family day care and outside school-hours care so existing childcare services can expand and new services can be created," Ms Rizvi said.

Opposition Children and Young Adults spokeswoman Jenny Mikakos said the report offered a flimsy excuse to refuse funding.

Ms Mikakos said the KPMG report also outlined strengths, including a safe and welcoming environment, health benefits and reduced social isolation.

"For Ms Lovell to now rubbish this program when she has spent the past nine months calling on the Commonwealth to fund it smacks of hypocrisy."

The Association of Neighbourhood Houses and Learning Centres rejected the report's conclusions.

Policy and research officer David Perry said the report acknowledged the benefits of occasional childcare, including referrals to health and well-being services, childhood development, diagnosis of developmental problems and improved social inclusion.

He said the consultants failed to understand the relationship between providers and their communities.