The Government has announced plans to redraw the council funding formula and remove deprivation from it. It means money allocated to councils could no longer be weighted to reflect the higher costs of poverty and deprivation.
The Government says it is a technical exercise to simplify the distribution of grants but the Deputy Leader of Sheffield Council has attacked the move.
Coun Olivia Blake said: “This is one of the most shameful things this Government has done – and that is really saying something.
“It is simply outrageous to suggest services such as homelessness have nothing to do with deprivation and resource is only needed solely on the basis of population numbers.
“It is well established that the cost of providing services increases in more deprived areas because need is greater due to inequalities. The Tories are once again taking from the most vulnerable.
“It’s no coincidence that over three quarters of Tory MPs represent constituencies covered by county councils
“Government spending cuts have impacted most on councils in more deprived areas already and yet the government are, shockingly, looking to make this worse still.”
Labour says urban districts in England have already suffered the sharpest real terms cuts since 2010 with a reduction in revenue spending power of almost 40 per cent compared with county councils seeing a reduction of 22 per cent over the same period.
A recent Centre for Cities report found that 74 per cent of cuts to local government funding over the last decade have fallen on cities – with the equivalent reduction of £386 per city dweller since 2009/10, compared to £172 per person living elsewhere.
The Conservative Party were unavailable for comment.