Local Government Secretary Eric Pickles has repeatedly criticised town halls for threatening cuts while hoarding cash reserves.
The Conservative minister ramped up the pressure last month when he said reserves have been increasing in recent years while some authorities "plead poverty".
Against threats to libraries, parks and bus services, official figures have emerged showing 20 councils across the region have stored just over £653 million.
Cornwall Council had £189 million in reserve to the end of March last year, and Devon County Council £108 million. Plymouth City Council and Torbay Council have each around £37 million in the bank, while Dorset County Council has more than £95 million stored and Somerset County Council around £83 million.
Smaller district councils in Devon, Somerset and Dorset have banked between £1.6 million in West Devon and £15.2 million in East Devon.
Pete Edwards, leader of Labour-controlled Exeter City Council, which has "sensible" reserves of £6 million, criticised "Big Brother" Whitehall ministers for interfering despite the localism agenda.
But Alex Folkes, deputy leader of the opposition Liberal Democrat group on Cornwall Council, said while the money is for a "rainy day" cuts to central government hand-outs mean it is "pouring".
