The new MP for Hartlepool said the decision to go ahead with a huge rise for councillors was 'ill-timed and wrong'.
At a meeting of Hartlepool Borough Council this week members voted in favour of the rise by a majority of 17 for to 11 against with three abstentions.
It will see the Basic Allowance given to the town’s 33 councillors increased from £5,953 to £7,792 a year.
The rise was recommended by an Independent Remuneration Panel which said it was needed to attract a wider range of the people to stand for the council by compensating those who work.
It also said it will bring Hartlepool more in line with allowances of neighbouring councils.
MP for Hartlepool, Mike Hill, has issued a statement in response to the rise.
He said: "In a week where national politics have, quite rightly, been focused on the Grenfell Tower tragedy and the consequential exposure of the impact of public sector cuts on an overstretched London fire Brigade, it is with regret and dismay that I return to the constituency to find that the biggest political issue in the town is the fact that the Labour Group and the Tories have (with the exception of three colleagues) voted through a 31% increase in Councillors' Allowances.
"Up and down the country, and in Hartlepool, during the General Election it became obvious that people understood that the Tory austerity agenda was not working; they got that there are fewer police on our streets because of cuts, that our schools are being hit by chronic under-funding, that our NHS is on the brink of collapse and our Local Authority Services are being stretched to the limits. They voted Labour in their droves because we have a manifesto for hope and re-investment in our communities and public services.
"Public sector workers – the heroes who ran towards danger in Grenfell Tower and the terrorist attacks in London and Manchester, have not only seen their numbers depleted year in year out but have also suffered pay restraint with an average of 1% across all services.
"It is with this in mind, plus the fact that our own council faces a further £1.5million in cuts, mainly to Children’s Services, and is running at a deficit, that the decision to proceed to accept the recommendations of the Independent Remunerations Panel was ill-timed and wrong.
"Like myself, our elected members are the public facing representatives of the Labour Party, yet they are not autonomous from and are accountable to the rank and file membership; members who fought a united General Election campaign on an anti-austerity agenda.
"Broken down, the report makes reasonable observations which any person in the street would understand, especially around the need to attract a wider range of people to stand for public office and the fact that the increases for the average councillor are extremely modest in comparison with neighbouring authorities, but the £76,000 does convert to a percentage increase of 31% and that is the unacceptable headline news.
"I take it as read that all councillors who voted against the proposal will exercise their right to refuse the uplift. I, also, take it as read that those Labour councillors who abstained will do the same. For all other members, it is a matter of conscience, although it is a shame that the more palatable route of adopting the recommendations incrementally over a period of years beginning with 1% in the first year to match the public sector pay restraints was not considered.
"As I have said, the General Election unified the Party. We are accountable to each other and must move forward as one. This is why I have established a neutral office at South Road to ensure a non-partisan approach to the Labour agenda, our agenda, of looking after the people of the town of Hartlepool."