OXFORD councillors will resist a radical Government plan to force council tenants from their homes, claiming it would create ghettos of poverty on city estates.

The proposals, announced yesterday, could see new council tenancies reviewed after two years and, if a family’s financial circumstances had improved, they could be asked to move into the private sector.

But senior councillors on Labour-controlled Oxford City Council say they will do all they can to avoid using fixed-term tenancies, claiming it would de- stabilise families and communities.

Council tenant Lilian Sherwood, 61, who lives in South Oxford, said the Government had not thought through the policy. She said: “If people can afford to buy later on, then fair enough, but don’t force them out. It will make them feel very insecure.

“It is a disturbance for families with children.”

Mrs Sherwood has been a council tenant for 35 years and is a single parent with children who have now grown up.

She added: “I worked to bring my children up and the security of knowing I had a roof over my head really helped.”

Oxford City Council has about 8,000 council houses, and tenants have the right to remain in their home regardless of any changes in circumstances.

But last year, the authority paid a total of £79,640 to 33 families under its scheme that offers cash to tenants who volunteer to move to smaller council properties.

Joe McManners, the council’s executive member for housing, said he would avoid implementing fixed-term tenancies at all costs.

He added: “It is quite damaging for tenants themselves and for areas, because it will create high concentrations of poverty.”

Dr McManners said it was a disincentive for people to improve their financial circumstances and added: “We don’t want to kick people out of their houses for doing well.”

But he said he could not guarantee the new powers would not be used, warning: “The Government might make it very punitive to not take them up on it.”

Oxford’s council housing waiting list stands at more than 5,000 people.

The council’s deputy leader Ed Turner said building more affordable homes was the way to address the issue. He said it was “unlikely the “council would use the Government’s proposed powers which would make communities unstable and turbulent.”

The Government said the new rules will help more people off the country’s housing waiting lists, now standing at more than five million.

Housing Minister Grant Shapps said: “The new system will protect the most vulnerable in society, ensuring those in greatest housing need are given priority.

“It will also be more flexible, with councils and housing associations able to offer fixed tenancies that give people the helping hand they need, when they need it.”

The Government is also introducing a new ‘affordable rent’ tenancy to allow housing associations to set rents at up to 80 per cent of local market rents – higher than current social rents.