The Government is asking Oxfordshire County Council to explain why it has set its council tax so high.

Hilary Armstrong, minister for local government and the regions, says she is "concerned" about the decisions the council has taken.

In a letter to former council chairman Harry Wyatt, leaked to the Oxford Mail, she says: "I believe that, on the face of it, your authority has set what may be excessive increases.

"I am particularly focusing on the extent to which local authorities have consulted the electorate about any increases.

"I should point out that I have not yet made any decisions regarding your increases and that I do not intend to make any public announcement about our meeting."

She says that though the budget and council tax set for next year will not be subject to capping, she wants assurances that huge increases will not continue. Only a small number of local authorities are understood to have received the letter.

Oxfordshire's council tax rise of 8.4 per cent for 2000/2001 was 0.4 per cent above the national threshold set by the Government.

Chief executive John Harwood said: "It is unusual for a local authority to be called in like this, but these guidelines came out only after our budget was set and we were not aware of them. There is no prospect of our being capped this year.

"We are confident that we have consulted properly on increases because we carried out a MORI poll before we set the budget.

"Our council tax is below average compared with other authorities. I am happy with the budget set and I did not feel any need to inter- vene."