Welsh First Minister Rhodri Morgan today dismissed as "bizarre" claims that money intended to help reduce council tax was being diverted instead to the NHS.
In his pre-budget report in December Chancellor Gordon Brown announced £22 million for Welsh councils to "meet the needs and concerns of council tax payers".
Today the Welsh Assembly Government announced that the majority of that cash -£19.5 million - would be given to local government to fund social care for the elderly.
Bridgend Council leader Jeff Jones, a senior Labour local government figure, said earlier that the move was undermining local democracy and was contributing to a "major crisis" in local government finance.
He told BBC Radio's Good Morning Wales programme: "Most people in Wales expected this to go to reduce their council tax.
"After all, the Chancellor who gave the money said that in his speech to Parliament.
"I believe this is a major mistake by the Assembly.
"It's the sort of mistake that gives politics a very bad name indeed.
"We already spend more money in Wales than in England on health. We don't spend it wisely.
"It will go into the black hole of the health service instead of being used to reduce council tax rises, which are already too great."
He added: "We have a major, major crisis in local government finance. Gordon Brown saw that. He tried to help us and the Assembly has snatched that away from us."
Mr Morgan said the money was not going to the NHS but to local government itself.
The money could not have been provided in the annual revenue support grant to councils as that had, co-incidentally, been finalised on the same day as Mr Brown's pre-budget report.
Mr Morgan said: "I don't think we're doing anything outside the spirit of what Gordon Brown said at all.
"It was just not technically possible to say this will be used to reduce council tax.
"It does have that side effect that if you give local government money that will reduce the budget pressures they have."
Local authorities themselves had identified social care as being a major pressure on their budgets, he added.
"To try to pretend getting £20 million is not good news for tax payers in Wales, I find it absolutely bizarre," he said.
Finance Minister Sue Essex said: "This is extra money going right where it's hurting. If they didn't get it they would either have to put council tax up or not provide the services.
"If we're a civilised country in Wales, this is one of the biggest challenges for us."