Needless centrally-imposed red tape is costing councils £4.5 billion a year which they need to fund vital services, town hall chiefs have said.
The Local Government Association (LGA) called on ministers to axe the bureaucracy as authorities braced themselves for more recession-enforced belt tightening.
Its research found every household was paying at least £11 a year more than needed on "data burdens", such as performance indicators.
Streamlining those processes would save £400 million, with another £250 million slashed from running costs by handing back more responsibilities to councils.
The LGA, which represents more than 350 councils in England, said £1.5 billion could be saved by slashing the running costs of seven Whitehall departments which councils deal with.
Central government staff numbers had soared by 21% over the past decade with permanent staff at Communities and Local Government rising 10% last year alone.
A further £1 billion could be found by ending "unnecessary policy activity", £900 million by giving councils more choice over spending and £430 million by cutting the admin bills of quangos.
The LGA said such savings could protect 300,000 school places, 175,000 personal care packages and 36,000 miles of road resurfacing.
Chairman Margaret Eaton said: "Billions of pounds of taxpayers' money is being spent on needless bureaucracy. We need a bonfire of red tape so that taxpayers' money can be freed up to protect frontline services.
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"Things need to be done better and cheaper. If we are to repay the large public debt, we simply cannot afford the same amount of excessive central activity and control of local services."
