CARE for the elderly, libraries and leisure facilities all face further cuts after George Osborne handed out tax cuts yesterday at the expense of local council funding.

The Chancellor announced in his last Budget that central government funding for local authorities in England would be phased out. Instead he proposed to allow councils to keep business rates raised locally, a plan likely to short-change poor towns and cities.

But yesterday he robbed councils of this contingency funding by slashing business rates centrally.

Some 600,000 small businesses will be taken out of the tax altogether, while 900,000 more high-street shops will see their rates cut.

It will cost the Treasury £6.7 billion over the next five years and deprive local councils of funding when business rates powers are devolved.

Councils in England have already seen their funding cut by up to 79 per cent since the Tories took power in 2010.

Labour leader Jeremy Corbyn said: “Every library that’s been closed, every elderly person left without proper care, every swimming pool with reduced opening hours or closed altogether is a direct result of government underfunding our local authorities and councils.”

Mr Osborne’s aides suggested last year that councils could flog off assets like golf courses, museums and parks to plug their shortfalls.

Yesterday’s Budget also included plans that could force local councils to outsource all of their services to privateers.

The proposal went unmentioned during the Chancellor’s statement to MPs. But under the headline “competitive markets,” the Treasury’s “red book” included a commitment to “consult on new rules requiring local authorities to be transparent about the cost of in-house services.”

The consultation would ask “whether there could be savings from using competitive external providers.”

Dave Prentis, general secretary of local government union Unison, hit back at the plan last night. He told the Star: “The government says it wants local authorities to be transparent.

“The same must be true for private companies running council and NHS contracts, so that the public can see their ‘hidden’ costs.

“The government could make a good start by publishing those for every PFI hospital contract.”