Committee chair Joan Taylor described the proposals as a 'charter for Rachmanism'.
she called for the government to allow councils to spend the capital receipts from council house sales on building and making more affordable homes available for rent.
'The government must not underestimate the strength of opposition to its consultation paper. It is a retrograde step that amounts to nothing more than a cheap political gambit to massage the homelessness figures.
'They will radically redefine the scope and nature of the social housing role of local authorities and hark back to pre-1977 when social services took more than 280,000 children a year into care because of homelessness,' cllr Taylor said.
The association is seeking an urgent meeting with health secretary Virginia Bottomley to discuss the impact the proposals could have on social services departments.