A council has been urged to spend some of its savings after it emerged it has almost £80m in the bank.

South Oxfordshire District Council has more savings than any other district council in Oxfordshire and is one of more than 50 local authorities with more than £50m reserves.

The bulk of the reserves date back to the sale of its council housing over a decade ago.

About £28m are revenue reserves, which can be used to fund day-to-day services, and the rest are capital reserves that are only available to spend on building projects.

Local Government Secretary Eric Pickles said: “All good councils should be considering the merits of temporarily dipping into the money they have set aside.”

Ann Ducker, the leader of the Conservative-run council, said no services would be cut in the next financial year.

And she added the council had already spent “significant sums” on community projects in recent years.

She said: “Because of the healthy state of our finances we will be able to weather the storm brought about by significant reductions in the amount of grant that we expect to get from the Government.

“I make no apologies for managing the finances of the council so well that we are able to plough back significant sums of money into the local community to support key projects.”

Ed Turner, deputy leader of Oxford City Council, said: “It is bizarre that Eric Pickles is urging councils to spend money that they can only spend once and should not be interfering in this way.

“The city council has revenue balances of about £3m, which is healthy but not extravagant.

“I don’t want to give lectures to other district councils about their levels of reserves.”

Lynda Atkins, who represents Wallingford on Oxfordshire County Council, urged South Oxfordshire to use reserves for Wallingford Youth Centre, which faces the loss of county funding.

She said: “The council could provide the money for a new youth club or it could help to revamp the existing facilities.”

South Oxfordshire District Council spokesman Olivia Bucknall said: “Each year the council decides what proportion of those reserves it is happy to use to avoid service cuts.

“It has funded a number of important projects from its reserves in recent years, including the redevelopment of Didcot town centre and the construction of the Cornerstone Arts Centre and cinema, which it leases to Cineworld, and the Orchard shopping centre.

“In total the council invested over £30m in securing a new heart for Didcot and now receives a healthy return on its investment.”

Vale of White Horse District Council has £1.76m in its revenue reserves and £9.7m in capital reserves.

A spokesman for West Oxfordshire District Council said: “The council has usable capital reserves of £18.1m and usable revenue reserves of £10.4m.

“The net worth in the council’s balance sheet is £58m, but this includes a number of large accounting entries such as £32m to offset the council’s pension fund liability and £5.9m provision for Iceland investments.”

Tony Ecclestone, a spokes-man for Cherwell District Council, said: “Our total reserves have reduced annually for the past four years as they have been used to fund projects that have assisted in reducing the net revenue budget by £5m, keeping council tax increases well below inflation. They ended 2009-10 at £7.2m and will reduce further by the end of the current financial year.”