COUNCIL tax rates may be increased by as much as five per cent in Oxfordshire to help meet the demands on public services caused by the coronavirus pandemic.

That is the option laid out for councils by the Chancellor of the Exchequer's spending review yesterday.

The Government is also providing £3bn for England's cash-strapped councils as a result of the review, but one of Oxford's MPs has said this did not match an earlier promise to fund local services.

The spending review, which sets the limits on how much money different areas of Government can spend over the next financial year, was laid out by Rishi Sunak yesterday afternoon.

According to the review, next year councils in England will be given the option of raising council tax by as much as two per cent.

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This is the same as the limit set last year.

But in a change to current policy, councils with responsibility for social care, like Oxfordshire County Council, are being given the chance to ask for an extra three per cent increase on the local tax charge to pay for social care.

The spending review document said: "Local authorities will be able to increase their council tax bills by two per cent without needing to hold a referendum, and social care authorities will be able to charge an additional 3 per cent precept to help fund pressures in social care."

It is unclear if Oxfordshire or other councils will take up the offer of a five per cent council tax increase yet, as they are still setting their budgets.

Oxfordshire has already set a medium term plan for the public purse, which assumes that council tax will rise by only two per cent each year.

The spending review document repeatedly stressed the demands social care placed on the budgets of councils.

In his announcement yesterday, the Chancellor also pledged to distribute a further £3bn to councils across the nation to help with Covid costs, plus another £254m aimed specifically at ending rough sleeping.

Details have not yet been provided as to how this will be divided across the country.

This funding is on top of £5.6bn of funding given to councils to spend on whatever they need already during the pandemic, as well as other ringfenced funds.

But Local Government Association had called for an extra £8.7bn rather than £3bn provided, in the run up to the spending review.

Anneliese Dodds, Oxford East Labour MP, was also critical of the Chancellor's funding for councils.

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Anneliese Dodds

Responding to Mr Sunak's address in the House of Commons, Ms Dodds, Labour shadow chancellor said: "Today the chancellor could have matched his Government’s promise to support local authorities through this crisis. He did not."

The Labour MP also criticised the Government's decision to freeze the pay of many public sector workers outside of the NHS, and its decision to cut the UK's foreign aid budget.

She said: "Earlier this year the chancellor stood on his doorstep and clapped for key workers. Today he announces a pay freeze for many of them.

"Many of the keyworkers who took on so much responsibility in this crisis are now being forced to tighten their belts."

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Ms Dodds was also critical that review announcement lacked any mention of Brexit.

Mr Sunak said his review helped to 'protect people’s lives and livelihoods' as he allocated £55 billion of Government funding to tackle coronavirus in the next year.

He added: "Today’s Spending Review also delivers stronger public services - paying for new hospitals, better schools and safer streets. And it delivers a once-in-a-generation investment in infrastructure. Creating jobs, growing the economy, and increasing pride in the places people call home."

Ahead of the chancellor's announcement, Oxford's other MP Layla Moran was also critical of the review.

The Lib Dem MP for Oxford West and Abingdon said the decision to cut public sector pay would 'cause unnecessary pain' and instead called for the UK to grow out of the Covid recession and debt.