County councillor Olive McIntosh-Stedman has been convicted of dishoneslty claiming council tax benefit.

A jury took just over an hour yesterday to find the 65-year-old guilty of making a false statement to obtain the benefit.

She was acquitted of another similar charge after a two-day trial at Oxford Crown Court.

Judge Christopher Compston said it was "a sad day", while a resident in the Cowley and Littlemore division, which McIntosh-Stedman represents on the council, said she had been "foolish".

The charge related to a council tax benefit form McIntosh-Stedman completed in December 2002, in which the former nurse failed to declare the income she received from a monthly NHS pension.

She also failed to disclose a savings account and the member's allowance she received from Oxfordshire County Council.

The court heard this led to her being overpaid council tax benefit by more than £3,000, although she has since repaid the money.

McIntosh-Stedman, of Williamson Way, Rose Hill, denied the charges and said she had forgotten to fill in the relevant parts of the form.

Judge Compston said he would adjourn sentencing until Thursday, December 20, to allow reports to be prepared.

He said: "I think this is a sad day for you, but I'm going to make it clear, of course, you are not going to prison."

McIntosh-Stedman refused to comment on the verdict outside court.

Mike Knibbs, chairman of Rose Hill's Villier's Neighbourhood Watch group, said: "I think it is sad it's happened and I'm a bit surprised. She comes to the Neighbourhood Watch meetings and she's always amenable and helpful.

"I think she tries a lot for the community, but obviously she has got some shortcomings. You could put a lot of things down to her eccentricity, but fraud is fraud."

Anne Mogeridge, the chairman of Littlemore Parish Council - of which McIntosh-Stedman is a member - refused to comment on the verdict, but said: "Olive works very hard in the area."

Rose Hill resident Bill Buckingham, a former city councillor, said: "What a fool is all I can say. As a councillor, she must have known what she was doing and to think she was going to get away with it was an absolutely foolish thing."

Cllr suspended by party

Olive McIntosh-Stedman was last night suspended from the Labour Party.

Immediately after her conviction for benefit fraud, McIntosh-Stedman, an Oxfordshire county councillor who has represented Cowley and Littlemore since 1997, was told she had been suspended.

The 65-year-old will now have to appear before a party committee.

A party source last night told the Oxford Mail it was "extremely likely" she would be expelled.

She was elected as a Labour councillor but earlier this year - after news emerged she was facing fraud charges - she left the group to stand as an independent.

She is due to be sentenced next month and until then remains a serving county councillor.

National rules state that councillors given at least a six-month custodial sentence are immediately stripped of their office and barred from standing for five years.

Although the judge indicated he would not jail McIntosh-Stedman, politicians called on her to resign her seat.

Labour's Oxford East MP Andrew Smith said: "She should go and go now - that is, resign from the council immediately. As she been found guilty by a jury of dishonesty, the public will have no confidence in her and her position is untenable."

County council Liberal Democrat group leader Zoe Patrick said: "Personally, I think she should resign immediately, because it brings the council into disrepute."

In a statement used by the defence during the trial, Keith Mitchell, the leader of Oxfordshire County Council, said McIntosh-Stedman was one of the most "diligent and hard-working county councillors".

However he refused to comment on the verdict.