A Council has reacted with anger over Government plans to scrape back more than £500,000 handed to them in grants.

Support grants for all councils the past two years have been re-calculated based on more up-to-date population figures meaning Kirklees Council must give back the cash.

Bradford and Calderdale lost £45,000 and £260,000 respectively in the adjustments, whereas other authorities may have gained.

But Kirklees feels it is the district's council taxpayers that will end up being short-changed.

Liberal Democrat Council leader Kath Pinnock has hit out at the clawback.

She said: "The Government's mistake mainly centred on the way it calculates grants in relation to the population of the area.

"It got it sums wrong for the last two years, and as a result the Council is having to pay back more than half a million pounds in grant.

"This is very unfair on the Council and council taxpayers because our budgets, and budget planning, were done in good faith and based on the Government's grant allocations at the time.

"To have the rug pulled from under us and being made to pay back this money is not helpful when many of our services - particularly vital social services for the most vulnerable people in our community - are stretched to the limit."

What is more the Office of the Deputy Prime Minister wants Kirklees to pretend it never even had the cash, said deputy leader John Smithson.

"We knew about the adjustment earlier in the year," he said.

"But now we have to find the money to pay it back out of next year's budget which will make things tight.

"They've also instructed us not to include it in the accounts and hand it back as if we'd never had it. We simply can't do that."

The ODPM said it was always a possibility that some money would have to be handed back and that the department was simply taking it out of next year's budget, which would be decided later this year.

A spokesman said: "The 2003/04 Local Government Finance Settlement Amending Report calculates the amount of grant each authority would have received had the revised 2001 mid-year population estimates, published by ONS on 9 September 2004, been available at the time of the 2004/04 settlement.

"For Kirklees, this would have been £527,000 lower than they had originally allocated.

"We have always been clear that we would issue and amending report for the 2003/04 settlement to incorporate the revised 2001 population estimates.

"It is only fair that authorities should receive the correct amount of grant relative to the updated population estimates."

He said all authorities were informed of the revised grant amounts in January.