There is no requirement that ornamental grasses be cut back. In a natural environment, other than the occasional brush or wildfire situation or grazing by animals, native grasses are not cut back and thrive and grow just fine. But in a cultivated garden, the wild and woolly look of unkempt OG's may a bit more "natural" than most folks prefer. The annual shearing of dieback or herbaceous OG's serves to remove the old, dead foliage and dried flowerheads and cleans the plant up for the coming season. It is a more formalized replication of the natural events described above.

If you don't mind the less tidy, natural look, you can leave your grasses uncut. When my gardening schedule has been so tight or some other reason has prevented me from this chore before it becomes too late to accomplish without damaging the new growth, I've left an occasional clump uncut and eventually the new growth has obscured the messy remains of the previous season. But in my small garden, I prefer to include an annual shearing with the rest of my late winter clean-up just to keep things looking neat and well-groomed.

FWIW, evergreen ornamental grasses are not routinely cut back. Some resent this process and are very slow to respond to such harsh treatment as it affects their ability to photosynthesize and therefore grow. Some will respond by turning up their toes and dying off entirely. Often, just a grooming or "combing" in early spring is enough to remove the dead blades and keep things looking good. Other, semi-evergreen species can benefit from a periodic shearing just to keep things tidy, much like the deciduous forms - just not as often.

Knowing the type of OG you have and its typical growth habit in your climate will dictate when, how hard and how often it should be cut back.

What type of tool do you recommend for cutting the Pampas grass back? I find it very difficult to cut due to the tough leaves and the fact they are so sharp edged?

I know folks that use electric hedge trimmers or chainsaws. Observe all proper safety precautions if using these methods :-)