"While we fully understand that Governments need to save money, we strongly advise against indiscriminate cuts in public health and social welfare, as it may cost more in the long run," said Bekele Geleta, the Secretary-General of the International Federation of the Red Cross.
In May charities revealed that more than half a million Britons are now turning to food banks, with that number expected to have increased over the summer. Many charities and opposition politicians say government cuts to welfare have made the situation worse, with families struggling to make ends meet with the rising prices, the economic downturn and a benefits squeeze.
While the Red Cross has in the past provided food to refugees and also to victims of the flooding in Cumbria in 2009, it would be the first time it has helped with the nationwide collection and distribution of food aid since the end of World War II.
Chris Johnes, the British poverty director for Oxfam, said he was shocked that the situation had got so dire that the Red Cross needed to step in.
"They don't do things for reasons of grandstanding at all," he said. "The fact that they are doing this ... is a very clear signal how serious things have become."
Red alert: How austerity is hurting Europe according to the Red Cross report
Greece
After two bailouts, Greece has the most stringent austerity programme in the eurozone. This is having a devastating impact on health and well-being, the Red Cross says; the suicide rate among women has doubled since the start of the crisis.
Spain
Austerity cuts are causing soaring unemployment in Spain, where a quarter of young people are now out of work. The Red Cross said unemployment in Europe was "a ticking time bomb" increasing the risk of social unrest and upheaval.
Russia
Migrants from all over the world who move to Europe for jobs get no social support. The report tells the story of Meerby from Kyrgyzstan, who went to Russia to work but ran out of money and was offered US$3000 ($3604) to sell her newborn baby. She refused and fled.
Italy
Up to 150,000 small businesses have closed, sending homelessness soaring. Some 50,000 people in Milan alone are receiving food aid. The Red Cross tells how Maurizio, whose business went bust, now lives in the camper van which was once his holiday home.
Moldova
Human trafficking is rising because of the crisis, the report says, as more people are desperate to move to places where they can earn more money. Moldovans pay up to 3800 ($6190) to be smuggled to another country, putting women and children at risk of exploitation.
Luxembourg
Even in the richest nation in the EU, with a per capita income of about 80,000, the Red Cross is running a programme providing food to the needy. France, meanwhile, has seen 350,000 people fall below the poverty line from 2008 to 2011.
- Independent