Households in wealthier parts of England could face sharp council tax hikes and service cuts under proposed reforms designed to direct more funding to deprived areas, a leading think tank has warned.

Analysis by the Institute for Fiscal Studies (IFS) suggests Angela Rayner’s plans to overhaul how local government funding is allocated would leave some councils in central London and the Home Counties grappling with budget cuts of up to 19 per cent.

To help councils adjust, the Government plans to phase in the changes gradually over three years and limit how much funding any council can lose each year.

But the changes will still create clear winners and losers.

The IFS found that 10 per cent of councils could see their funding drop by 14 per cent or more, while another 10 per cent cou

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