People working with disadvantaged children are celebrating after a Government U-turn over funding.

The Oxfordshire Children's Fund was told last week it was to have its £1.1m annual budget slashed by more than £160,000 in 2004/5.

The fund has now been told that the reduction will only amount to 2.8 per cent - £30,748 - and services will be able to continue more or less as normal. Directors were overjoyed to get confirmation that Education Secretary Charles Clarke had reversed the decision.

The Children's Fund runs projects across the country for five- to 13-year-olds, including the Oxfordshire Youth Offending Team, which has the biggest share of funding to help children at risk of committing offences.

Mike Simm, head of the Oxfordshire Youth Offending Team, had warned that the cuts would mean £30,000 less to spend over the coming year on three schemes designed to identify and support vulnerable eight- to 13-year-olds.

But the last-minute u-turn means staff should be able to carry on more or less as normal.

Mr Simm said: "There is still uncertainty about 2005/6 but it is a major relief that the cuts only appear to be marginal."

Families in Oxfordshire use 50 Children's Fund projects, including play and art groups, anger management and parenting support programmes.

Penny Faust, chairman of the Oxfordshire fund, said: "This is such a fantastic u-turn - you

cannot imagine the difference it will make, hopefully we will be able to continue providing all our services."