All six councils in Oxfordshire are among at least 40 local authorities in the UK caught up in the Icelandic banking crisis.

None of the money — £28.5m in total — is used in local government employee pension funds, but it is all taxpayers' money. County Hall is now waiting to hear if investments in three Iceland banks will be re-paid.

The situation with the Icelandic banks remains unclear and has changed several times over the last 24 hours. The councils are pushing the Government for a clear statement on the position of these funds.

West Oxfordshire District Council has £9m, Cherwell District Council has £6.5m, Oxfordshire County Council has £5m, Oxford City Council has £4.5m, South Oxfordshire District Council has £2.5m and the Vale of White Horse District Council has £1m. Oxfordshire County Council's cabinet member for finance, Charles Shouler, said that County Hall's element of the annual council tax bill would be unaffected by the crisis. It has its money tied up with Landsbanki.

He said: "The Local Government Association will no doubt be working hard on behalf of the many councils who would have had funds invested with the Icelandic banks.

"We start the year with a total budget of around £1bn.

"We do not spend all of that money in one go at the start of the financial year, so we need to keep it invested in banks. We also keep our reserves in such accounts.

"We obviously want our £5m back. It is only a small part of our overall budget — but £5m is a large sum in anybody's book."