Despite the Government announcing investment of £508m in elite sport in the next four years, athletes or teams which are unlikely to qualify for Rio are almost certain to have their funding completely removed, according to sports minister Hugh Robertson.
London 2012 was the first time a Great Britain team had entered the handball competition but both the men’s and women’s teams lost all of their group games.
“I’m really annoyed and disappointed," said Williams.
Incredible handball goals at the Olympics
"What’s happened to legacy and Inspire a Generation? They were the taglines. It seems that’s all they were.
"To announce this now, just days after London 2012 finishes, is typical political propaganda. Everyone is still on a massive high from the Games and maybe they think this news will be lost amongst all the good headlines.”
Williams also believes that the target eighth place finish at London 2012 was unrealistic after having their funding halved midway through the Olympic cycle.
“When the funding was reduced, the target stayed the same," he added.
"How does that work? It’s shambolic really. We had no chance of eighth on that level of funding.
"Both squads worked really hard, but there’s only so much you can do when we’re all in different countries and not able to train together centrally because the money isn’t there.”
Team GB competed in all 26 sports at this year’s Games, and in every discipline bar Greco-Roman wrestling – including debuts for men’s volleyball and returns for water polo and basketball teams after decades of absence.
“I feel like us and some of the other smaller sports have just been used to tick the box to say we competed in every sport," said Williams.
"The team have sacrificed a lot over the past few years to do this. We haven’t slept on floors and cleaned toilets to support ourselves for nothing.
"We won’t take this decision lying down. We will fight on. This is the players’ livelihoods at stake, as well as the future of the sport in this country.
“We need funding to go to tournaments – it costs to enter them. We’re using the last bit of money from this cycle to get to the qualifiers for the Euro’s later this year.
"The public reaction to handball has been amazing, but if there is no money to fund it, there will not be a top level team for the next generation to aspire to.
"The grass roots game is going to do well, but players will hit a ceiling when they want to reach the very top. Kids in Britain won’t be inspired by watching France win gold medals. They want to see Team GB doing that but it won’t happen until we have proper funding.
"If we had a fully centralised programme, there is no doubt in my mind we would qualify outright for the 2020 Games.”
Williams and his team-mates have been training with clubs across Europe following British Handball’s budget being reduced due to the troubled economy.
UK Sport describe their funding stance as 'no compromise', seemingly leaving little hope for the likes of handball and water polo.
“It will be interesting to see how they handle it," added Williams.
"Perhaps they think it’s easy to take the money away from the smaller sports, that we will fight less for it.
"I don’t begrudge any sport or athlete central funding – everyone works very hard. I feel very strongly though that to treat handball like this is wrong.
"All the hard work put into building two teams from scratch over the past six years will have been wasted."
Blast from the past - When Norway's women took Handball gold at Beijing in 2008