Blame for this year's increase in Sussex council tax bills was today laid at the Government's door.

The Audit Commission defied ministers by confirming cash had been switched from the South-East to Labour heartlands in the north.

Brighton and Hove got a Government grant increase of only 3.5 per cent.

East Sussex County Council received an increase of 3.8 per cent and West Sussex County Council four per cent - well below the national average of 5.9 per cent.

East Sussex County Council leader Peter Jones said: "I am delighted the detailed work undertaken by the Audit Commission confirms many of the views taken by local government leaders last year about why council tax had gone up by so much."

The situation was made worse by "unusual" spending demands from Government for extra National Insurance and pension payments and cash for schools.

Councils in Sussex had been left with a stark choice - to cut services or increase council tax bills.

Brighton and Hove City Council opted to bridge the gap with a 16.4 per cent increase in bills, including the police precept of £151.25 for an average band D home.

The report Audit Commission said: "We found a clear association between the size of grant increase a council received and its increase in council tax.

"The greater the increase in grant, the less was the increase in council tax."

Local government minister Nick Raynsford had flatly denied any link between the size of grants and the bill sent to householders or cash had been redirected from councils in the South-East to Labour's strongholds.

Local authorities face another tough year in 2004/5 after Brighton and Hove got a grant increase of only 3.6 per cent. East and West Sussex got 4.5 per cent each.