The elderly make up nearly two-thirds of social services' clients

Spain, a group of charities including Age Concern and Help the Aged, said older people were the "poor relation".

Just under half of council care budgets are spent on the elderly, despite them accounting for nearly two-thirds of the clients.

The government said it was taking measures to deliver services around the needs of older people.

Spain's report, What Price Care in Old Age?, revealed the number of homes receiving home care - the majority of which are the elderly - had gone down by a quarter since 1997.

Rationing social care funding for older people is making later life a misery for thousands Annie Stevenson, of Spain

It added social services were "creaming off" money to pay for services for younger people.

Some 62% of people who receive care from local authority social services are the elderly, but they receive just 47% of the funding, according to figures for England and Wales.

Spain said the arrangements meant the elderly were missing out on crucial services such as cleaning, housework, respite and transport aids.

And the report cited the case of 72-year-old Margaret Cracknell, from East Anglia, as a typical example of how the elderly were treated.

Mrs Cracknell's husband has cerebral palsy and needs 24-hour care to prevent him from failing.

Desperate for a break as she was suffering from depression, she asked social services for support looking after him.

After three months a social worker came to assess their situation, but still nothing happened, she said.

It was only after her husband had an accident and she had a nervous breakdown that respite care was offered.

'Dignity'

Mrs Cracknell said: "Social services don't seem to listen. Health professionals have told me its down to money. There's not enough to go round so they keep you waiting in the system, hoping you'll go away."

Spain chairman Annie Stevenson said: "Older people are paying for inadequate social care funding with their own mental health, physical health and dignity.

"Rationing social care funding for older people is making later life a misery for thousands."

The charities said the issue needed to be urgently addressed as "over the next decade rising numbers of older people will create a need for additional resources".

And they said government proposals to give people control and choice over their care will be broken unless there is an increase in funding for older people's services.

Care Services Minister Liam Byrne said the government was investing �250m in research and development centred on the needs of older people.

And he added the government was working with the Local Government Association and Association of Directors of Social Services to "ensure services are delivered around the needs of older people".

He said: "Dignity for life is our ambition."

Shadow Health Minister Simon Burns said the report confirmed what had been known for a long-time and should act as a "wake-up" call.

"Since 1997 we have seen a dramatic fall in domiciliary care provision and a worrying amount of money intended for older people being siphoned off to pay for other services."