Are the funds received from a government institution that offers interest-based loans and resembles insurance companies considered unlawful (haram), and what should I do with the remaining money, knowing that my father will not allow me to dispose of it?

There is no objection to benefiting from this grant, even if the institution engages in forbidden activities or some of its sources are illicit. This is because illicit wealth, when earned through unlawful means, is forbidden only to its earner. As for the father's membership in the institution, if it is compulsory, there is no objection. However, if it is voluntary and the surplus goes to the members or is invested on their behalf, then it is permissible cooperative insurance, and there is no issue if not everyone benefits. But if the institution lends money to members with interest, or provides homes with interest, or places money in an interest-bearing investment account, then membership in it is impermissible. And if the membership is voluntary and the surplus goes to the institution itself, then this is forbidden commercial insurance.