West Sussex County Council claims it is missing out on more than £6 million because the Government is using out of date census information to calculate its grant.

New county council leader Henry Smith has criticised central government for not using the latest 2001 data in calculating the council's grant for 2004/5.

Instead, 12-year-old information from 1991 will be used, according to an announcement by Local Government Minister Nick Raynsford.

Now there are fears next year's council tax will increase for the third year running unless significant changes in the way services are run are made.

One of the major differences in the two censuses is the increasing elderly population in Sussex which is heaping financial pressure on social services.

The Government claims the late availability of 2001 data, combined with a shortage of civil servants to process the information, prompted the decision to use out-dated information.

Mr Smith said: "The new data shows there are more people who need services from the county council that government should be funding, but the Government's decision means we get no recognition of this in our grant allocation.

"West Sussex experienced a very difficult budget this year as the Government switched funding away from the South-East. The county council did all it could to limit the effect but still needed an 18.5 per cent council tax increase to ensure the continuation of essential services.

"This news that out of date information is being used to decide our funding will only make more difficult the decisions we have to make over the provision of services and council tax level next year."

Nick Rodgers, leader of the Liberal Democrat group at County Hall, suggested the Government was playing a cynical game with voters' cash.

"If you look at the shifting demographics across the country, it is interesting to note that most of the councils losing out this time round are county councils.

"Metropolitan councils, which are traditionally Labour strongholds, do much better out of this."

The Durrington councillor added: "No doubt the biggest shortfall will be in the provision of care for the elderly. The most expensive part of that is making sure older people can lead independent lives in their own homes to prevent bed-blocking in our hospitals."

George O'Neill, leader of the Labour group at County Hall, said he would support any efforts by Mr Smith to get more money out of the Government.

The Littlehampton councillor said: "As a Labour group we would never want to see cuts in services - or an excuse for cuts in services."

Residents and traders, who have seen their council tax rocket by almost 30 per cent in the last two years, outlined where £6 million could be spent.

Eric Collard, a carpet retailer in Burgess Hill, said: "Some of the roads around here are atrocious and there are a number of accident black spots that need looking at.

"Several residential homes have closed around here in recent months so care for the elderly would obviously be another major priority."

Peter Fitzgerald, chairman of a residents' association in Haywards Heath, said some of the £ 6million could have been spent improving public transport, making the roads safer and providing more facilities for young people and the elderly.

Jane Robinson, West Sussex County Council spokeswoman, said the county council was undertaking a public consultation exercise, using a countywide newsletter, to see what the people of West Sussex wanted.