Councillor Morgan, who leads the local authority, challenged hecklers who shouted “shame on you” and “total mismanagement” at him and his colleagues in the cabinet meeting on Wednesday.
He said he would feel “no shame while protecting” other key services.
The council currently spends just short of £500,000 a year subsidising the site.
Head of financial services Stephen Harris warned cabinet members that any more use of the council’s reserves could put other projects, such as new schools, at risk.
The mothballing process of the site will take six to seven months and £53,000 has been set aside for the building’s upkeep.
“We have no intention of losing the facility,” added deputy leader, councillor Jamie Pritchard.
Councillor Morgan said he hoped Llancaiach Fawr could reopen without the need for a council subsidy.
At the same meeting, cabinet members agreed not to axe a meals on wheels service.
They will ask officers to find ways to make the service more sustainable.
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