It says much about the incoherence of the so-called big society that the coalition's own ministers struggle to define it. But the essence of the project is still best captured by David Cameron's declaration that "there is such a thing as society, it's just not the same thing as the state". The remark was an attempt to distance the Conservatives from Margaret Thatcher's toxic legacy but it also hinted at a desire to increase the power of the intermediate institutions between the state and the market. Mr Cameron's belief that voluntary groups could supplement and eventually replace the state in the field of public service enthused many beyond his own party.

From the beginning of the project, sceptics noted that few had the time necessary to devote themselves to the big society. An apt example of this was provided by Nat Wei, the Conservative peer charged with promoting the project. He has cut back on his role after concluding that working for free three days a week is incompatible with "having a life". Oscar Wilde once remarked that the problem with socialism "is that it takes up too many evenings". The big society suffers from the same defect.

But if the project was merely impractical in an age of plenty, it is unworkable in an age of cuts. The big society was conceived in the early years of Mr Cameron's leadership, when the Tories spoke of "sharing the proceeds of growth" (mistakenly assuming, like Gordon Brown, that growth would never end) and pledged to match Labour's spending levels. Since then, the government has embarked on a programme of premature fiscal retrenchment that includes the largest cuts to councils since 1945. The £35bn voluntary sector, no less than 40 per cent of which is dependent on state support, is among those areas that will be hardest hit. Even before most of the cuts have been introduced, Liverpool, selected by Mr Cameron as one of four "vanguard communities", has pulled out of the project.

Tory MPs may dismiss this as a partisan move by a Labour-led council but they will struggle to ignore the criticisms of Dame Elisabeth Hoodless, who has led Community Service Volunteers for 36 years. She warns that the coalition's cuts are "destroying" Britain's army of volunteers and that the government has no "strategic plan". The truth is the sector was thriving long before Mr Cameron entered office, with 13.5 million people volunteering at least once a month. But, as a result of the coalition's doctrinaire spending cuts, it may look very different when he leaves.

Forced to choose between the needs of society and the needs of the market, the government has deferred to the market at every opportunity. The coalition's privatisation drive now includes the Royal Mail, the port of Dover and England's public forests.

Figures from the left and the right have proposed imaginative alternatives to ever greater rule by the markets. The Conservative MP for Dover, Charlie Elphicke, has called for the harbour to be turned into a "people's port" by transferring ownership to a community trust. The centre-left campaign group Compass has proposed turning the Royal Mail into a not-for-profit company, along the lines of Network Rail and the BBC Trust. But the coalition has shown no enthusiasm for such big-society solutions. For Mr Cameron, the possibility to make a quick profit overrides all else.

In recent months, the Prime Minister has performed U-turns on issues including school sport, free milk and Bookstart. To this growing list he should add the planned cuts to the voluntary sector. It faces an estimated £1.14bn reduction to its local government grant this year and almost £3.1bn in total by 2014/2015. It is intellectually unsustainable for ministers to argue that the sector can expand, or even stand still, while enduring such cuts.

The onus once more is on the Liberal Democrats, whose councillor base is privately alarmed by the Tories' disregard for local government, to force a change of course. Yet how likely is this?

Should Mr Cameron fail to act now, the big society will die the death of a thousand cuts.