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A senior Labour MP has called for a referendum on English devolution.

But rather than setting up an English Assembly, Graham Allen said tax-raising powers should be handed to existing local authorities.

And he called on local authorities in England to "get off their knees" and fight for such a change.

Earlier in the day, the Local Government Association called for councils, not ministers, to decide funding levels in England.

Sir Merrick Cockell, who heads the umbrella group of councils in England and Wales, said the current model of council funding - where local authorities get most of their money directly from central government - was outdated and inefficient.

He called for councils to determine their own funding levels, spending priorities and appropriate taxes and for a major shake-up in Whitehall in which five departments would be merged into an Office for England to drive provision of local services.

Mr Allen, the MP for Nottingham North who is also chairman of the Commons political and constitutional reform committee, praised the LGA plan, saying it was the first step towards ending local councils' "subservience" to Whitehall.

"You thought this was an LGA document - it's not. it's a battle cry for everybody in local government to get off their knees and demand their independence," he said.

Speaking at the LGA annual conference in Manchester, he said: "Just about every western democracy has separate and independent local government. So this is a road map to help us get to that position.

"To actually make that break away from the centre so that we can run our own affairs."

He called for cross-party backing for the LGA plan, telling delegates "this can't be a partisan piece of property".

And he called for a referendum on English independence on the same lines to the one due to be held next year in Scotland.

"Why on earth can't we do something comparable in England? What is it about Scotland, Wales and Northern Ireland that means that the English can't get their own devolution?"

He said the "vehicle" for future devolution should be local government rather than a new Parliament or Assembly.

"Let's use that structure. Give it the powers, give it the finance and let them get on with bringing our country - the last country in the Empire - England to its own independence."

He said his committee would work with the LGA to frame new laws that would define local government in statute "as a separate, viable entity" and called for income tax raising powers to be handed to English local authorities.

"Why is it that the Scottish Parliament can keep the product of 10p of income tax? Why is it that the Welsh Assembly want that and Northern Ireland won't be far behind? Why can't we do that in England?"

This would, he argued, make sure that money goes directly to local councils rather than through what he said was the current "labyrinthine process" where "nobody quite knows where it's comes from and who is accountable for it".

The government has said it is right that decisions on national funding should be made by ministers and point to decentralising measures passed by the coalition, including allowing councils to directly retain money from business rates.

Local Government Secretary Eric Pickles will speak at the conference on Wednesday.