Millions of households face a stealth council tax rise because of Government plans to create more directly elected mayors.

Angela Rayner’s proposals could see the abolition of County and District Councils which handle different duties, as well as Unitary Authorities.

Existing combined authority mayors already levy a precept on top of council taxes in Manchester, Liverpool and Cambridgeshire.

The Deputy Prime Minister has approved the creation of mayors in Greater Lincolnshire and the combined authority of Hull and East Yorkshire, which are set to be elected next year.

Hampshire, Sussex, Kent, Essex and Cheshire are thought to be next to bid to have a Mayor.

Ms Rayner said: “Mayors will be hard wired into the fabric of how we govern and will lead the way on house, building, transport skills, and more. Too often, mayors’ hands are tied by Whitehall, even when it comes to allocating their own budgets.

“So we will create a clear and transparent route for all mayoral combined authorities to receive an integrated settlement. This means moving resources between projects that matches what their people need.”

Local government minister Jim McMahon said local government reforms would give elected councillors “far more power” to make decisions in their areas.

But some MPs warned that the English Devolution White Paper which the Ministry of Housing, Communities and Local Government published on Monday could see money spread out over larger areas.

Meanwhile local elections could be delayed for a few months or a year for councils that are far along in the process of being overhauled, Ms Rayner said.

The Deputy Prime Minister added: “We’re asking people to come forward as quickly as possible, and if they’re near enough to a deal and they say: ‘Well, you know, we just need a few more months, and then we can put that system in place’.

“If they came to us and said ‘that’s where we’re at’, then we may look at postponing, but it wouldn’t be for longer than a couple of months, a year.”