Free bus travel for pensioners could lead to council tax rises because councils have not been given enough cash to pay back travel companies.

From April, over-60s will be able to ride free under the Government scheme.

Councils will be given money to reimburse bus companies for the free travel but many say they will not receive enough to cover it.

Brighton and Hove City Council is estimated to be £1.5 million short, Adur District Council £280,000 short and Eastbourne £400,000 short.

Many councils are lobbying the Government for a fairer deal to avoid putting council tax up further.

As part of the consultation process, Roger French, managing director of the Brighton and Hove Bus and Coach Company, has written to the Government criticising the scheme.

He said: "To be blunt, the proposal can be described in one word crazy.

"The proposed indices bear no relation to current bus use or anticipated increased bus use from April.

"Consequently both Brighton and Hove City Council and Adur District Council, the two main areas in which this company operates, will both be seriously underfunded, assessed at £1.5 million and £280,000 respectively.

"This is completely unacceptable and unfair, particularly when I am also advised that other districts will be over-provided with funds.

"It seems to me that those authorities who have worked positively with bus companies such as ours to successfully grow the market for bus travel and create a positive culture for bus use in the community with a comprehensive network of bus routes are being penalised while authorities with poor bus use reflected by a poor network of bus services are being rewarded."

Mr French added that as the scheme stands, his company might not be in a position to sign up to the free travel scheme if local authorities were not able to properly reimburse it.

A spokeswoman for Brighton and Hove City Council said: "This council, along with other councils, is lobbying the Government for a fairer deal as part of the consultation process.

"We shall know how much we have got for the scheme when the Local Government Settlement is announced in November."

Chris Williams, council finance spokesman for Eastbourne, said: "It would be extremely unfair if every household in Eastbourne should have to fund the scheme because the Government has not got the funding right."

At present, pensioners get half fares across most areas of Sussex by producing a concessionary bus pass.

Providing the funding situation is sorted out, people over the age of 60 will be able to get free travel nationwide with the same pass from April, 2006.