While some town halls will receive more money through a new plan to fund local government, Brighton and Hove was told it faces a 2.8% cut.
It makes our city one of the worst affected areas in the south east and saddles bosses with millions more pounds of savings to find in already squeezed budgets.
Council leader Jason Kitcat said: “I have been asking Eric Pickles, 'Why us?'
"Mr Pickles’ response is that we should now pay as for some years we have done quite well with funding.
“But that is because we have challenges that others do not, such as housing need and a high number of over-85s.
“We’re not a typical south east city.
"We’re not a Woking or a Guildford.”
Local government secretary Eric Pickles claimed the new plan to fund town halls represented “a bargain for local authorities”.
He added new handed-down responsibiities would give council bosses more incentives to improve their areas.
But politicians across the county warned reduced funding would hit services, residents and staff hard.
The changes announced yesterday take into account the Government transferring a number of powers, such as administering council tax benefit and providing emergency funding to those in need, to local authorities.
With town hall finance chiefs last night breaking down the detail, the full impact is not yet clear.
From April, Whitehall will also allow town halls to keep a portion of business rates collected in their areas, claiming the move “rewards those which improve their communities”.
Mr Pickles claimed councils like Brighton and Hove, which had proposed a council tax rise for the coming year, were letting their residents down by “crying wolf”.
He urged local authorities to take advantage of a one-off sum to freeze the rates for 2013/14.
The minister also produced a list of “50 ways to save” which he claimed would mean councils were run more efficiently.
But Coun Kitcat said he did not feel government funding should be allocated in a “robotic nature”.
He added: “There’s no way a government minster can comprehend the diversity and the needs of areas.
“The only way they can do this is by devolving more power to councils rather than this pretend localism where ministers continue to hold the purse strings.”
With more than £20 million of savings to be found, Coun Kitcat said there was some “room to manoeuvre” in the budget plans for next year, which will be discussed by all councillors in February.
Conservative councillor Geoffrey Theobald said he felt the settlement was “reasonable” given the “incredibly difficult position the Government is in with regards the deficit and national debt”.
Labour councillor Gill Mitchell said: “In addition to cutting the grant overall, the Government is placing new requirements on Brighton and Hove which they’re not willing to fund.”
The revised Government grant funding for Brighton and Hove is the equivalent of £2,148 per house in the city.
Only Eastbourne (£2,189) and Hastings (£2,230) will receive a higher average amount in the county.
Compared to the old scheme, Arun, Mid Sussex and Wealden will receive an increased amount.
But Hastings is one of the worst affected areas in the country with its sum down 13.4%.
Even with an extra £850,000 payment by the Government, council leader Jeremy Birch admitted it was “very difficult to swallow”.
He told The Argus it would mean reduced or scrapped services and staff cuts.
A spokesman for East Sussex County Council said he was not anticipating it to affect its medium-term financial planning.
A spokesman for West Sussex County Council said: “The next step will be to go through the figures in detail – at this stage it is too early to assess the full impact.”