The have also tried to boost income by removing discounts for second homes and charging a 50 per cent surcharge on properties that have been empty for two years or more.
He added: "The latest localism farce is the power to introduce a local council tax support scheme.
Richard Farnell slammed the government for asking council's to run local council tax support schemes while cutting the cash to administer it.
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Conservative and Liberal Democrat councillors have defended the changes, which they say are necessary and prudent to help cut Britain's spending deficit.
He said: "The council tax support scheme is being introduce under the Localism Act.
"In reality the only choice is whose council tax benefit is going to be cut the most."
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To do this they have cut the amount of benefit people can receive by capping it at 75 per cent, removing a second adult rebate and stopping people back dating claims.
Changes will see rise in Rochdale council tax bills
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It means the council has had to design a cheaper local council tax support scheme while increasing income.
They also said they would cut funding when they transfer responsibility to Rochdale.
Lib Dem Coun Dale Mulgrew said: "It's interesting that the previous Labour government agreed there had to be reforms to the welfare system, as they thought it was far from perfect.
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"We can now decide who gets help with their council tax and by how much, but the government has sneaked in a miserable 4m cut in Rochdale's council tax benefits at the same time.
Finance chiefs predict this will increase income from council tax by 1.5m a year.
the Localism Act is all about handing power down from Whitehall to local councils to improve decision making and to involve people in delivering services, but it's nothing of the sort. It gives people the power to object to the closure of local services and public buildings, but no money to keep them going."
Rochdale Conservative group leader, Coun Ashley Dearnley, said: "Britain needs to cut its deficit and the government's efforts to do so have ensured this country has kept its triple AAA lending status and not ended up in the mess places like Greece and Italy have."
The changes are being brought in after the government said it would no longer administer local council tax benefit systems and told Rochdale council it would be their responsibility from April 2013.
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