Croydon Council will receive just £800,000 of a new £300m relief fund intended to ease the pressure of local government cuts, as Labour politicians accused the Prime Minister of "buying Tory votes" with the funding deal.

Steve Reed, Labour MP for Croydon North, has denounced the grant as a "blatant misuse of public money" after analysis by his office found that 83 per cent of councils that will receive the extra cash are Tory-led.

The fund was announced on Monday, after months of lobbying by councils and MPs to slow the pace of cuts proposed in the local government finance settlement, due to be voted on by MPs this evening.

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Some 30 Tory MPs were rumoured to have threatened to vote against the Government before the fund was announced.

Croydon is one of 17 Labour councils to get extra cash, out of 187 local authorities set to benefit from the fund.

Your Local Guardian:

Steve Reed, Labour MP for Croydon North

The council will receive £800,000 over the next two years to ease the blow of a 56 per cent cut in the revenue support grant.

Neighbouring Surrey, a Tory-led council, will receive £24.1m - the highest in the country.

Out of the top 25 beneficiaries of the grant, only one is a Labour-led council: Nottinghamshire, number 24 on the list, will receive £4m from the fund.

Croydon Council leader Tony Newman said: "I think it's grotesque that the Prime Minister is buying Tory votes in the House. It's a total distortion - they are passporting money to the Tory shires."

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Coun Newman was yesterday forced to announce a 3.99 per cent rise in Croydon Council's share of council tax in the wake of Government funding cuts.

He today hit out at Gavin Barwell, Conservative MP for Croydon Central, for his support of the Government on the issue.

He said: "Gavin Barwell seems to get off lightly in a lot of these issues, but he's the number two whip in the Government, and he's getting MPs to vote for Surrey, not Croydon."

Speaking from Westminster, Mr Barwell said: "Surrey is not better off down the line than Croydon at all. It's just short term help.

Your Local Guardian:

Gavin Barwell, Conservative MP for Croydon Central

"What the Government has done is to provide some extra funding to the councils taking the biggest hit to get to the final point they're going to get to. It's true that a good number of them are Conservative, but there are Labour ones too.

"What's going to matter to the people of Croydon is what Croydon is getting. I hope people will feel we have got a reasonable deal."

In November Croydon Council announced it would offer voluntary redundancy to its entire workforce in the face of Government austerity.

Tory councils overall will receive £255m of the grant money, Labour claimed, while councils in Labour-led areas will receive £17 million.

Tim Pollard, leader of Croydon Council's Conservative group, said it was a "perfectly legitimate question to ask the Government" how the £300m had been allocated.

But he was sceptical about claims that the allocation of the grant had been politically motivated.

He said: "I would be surprised, because civil servants are pretty robust about that. Governments come and go, but civil servants are always there to justify how decisions are arrived at.

"I think for decades Croydon has got the bum end of deals on local government finance, and both sides have complained vociferously about that to both parties of Government.

"There's something about Croydon that seems to not score well when the cake is being divided."

Mr Reed, the shadow minister for loval government, said: "The Government is covering up where this money has come from and won’t explain why almost all of it is being handed to Tory councils just weeks before council elections across the country.

"Councils in poorer areas have suffered much harsher cuts since 2010 but they are getting next to nothing. The Tories have picked millions of pounds from taxpayer’s pockets to buy off their own MPs when faced with a rebellion in the run-up to local elections."

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