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Council leader told how he secured 'gentleman's agreement' to avoid tax hike

A Tory council leader told how he had secured a "gentleman's agreement" with the Government to avoid an embarrassing 15% tax hike.

Downing Street has repeatedly denied striking a ''sweetheart deal" with Surrey County Council to kill the double-digit tax rise.

But David Hodge told a private meeting that he had direct dealings with Communities Secretary Sajid Javid over its financial struggles.

In a recording leaked to the BBC, the council chief is heard telling Tories he was "looking for help on how we could stop a referendum" and "every leader ... will always have these conversations to try and get a better deal".

He added: "There may come a time that if what I call a gentleman's agreement, the Conservative party often does, are not honoured, we will have to re-visit this in nine months or a year's time.

"If we do, let me assure you, you will have to drag me kicking and screaming not to go for referendum next year."

Labour leader Jeremy Corbyn confronted Prime Minister Theresa May in February with leaked text messages involving Mr Hodge that appeared to show negotiations over a deal.

The council leader had backed down over plans to hold a vote on the massive tax hike and put forward plans for a 4.99% rise instead.

A spokesman said Surrey Council stood by its previous statement that there had been no deal.

A Department for Communities and Local Government spokesman said: " As we have repeatedly made clear, there was no special deal for Surrey County Council and they will not receive any extra funding that would not otherwise be provided or offered to other councils. To imply the opposite is simply untrue.

"Surrey County Council informed the Government it wanted to become a pilot area for the 100% business rates retention scheme.

"DCLG made clear this was not possible for 2017/18, but subject to meeting the necessary criteria, it could apply in the 2018/19 pilot.

"As part of the statutory draft Local Government Finance Settlement consultation, DCLG discusses local government funding with councils across the country, of all types and all political parties.

"This happens every year, involves councils making representations to the Government, and has always been the process."

Shadow local government minister Gareth Thomas said the PM must "come clean" over the deal.

He added: "This recording proves what we have long suspected. The Government came to a secret 'gentleman's agreement' with the leadership of Surrey County Council, whilst the rest of the country faces a crisis in social care and brutal cuts to council budgets.

"Theresa May and her ministers, including Sajid Javid, have been playing political games, conducting backroom sweetheart deals for their friends, whilst councils across the country struggle to cobble together the money to adequately fund social care."

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