There will be no courtroom showdown between the city and county councils over the legality of residents' parking permits.

The end of the road in challenging the controversial scheme came last night, when Oxford City Council leader John Goddard said he did not want to waste potentially hundreds of thousands of pounds on legal fees.

Mr Goddard said: "The city council has sought legal advice and it was not encouraging.

"(We were told) our chances of winning this case were not good and we are not in the business of throwing money at lawyers.

"I'm disappointed, because I think the county is wrong and they're trying to sting people.

"It's yet another example of how the two-tier system doesn't work to the city's advantage, but we recognise that so long as there is a two-tier system, we have to co-operate where that's possible.

Earlier this year, questionnaires were sent to 26,000 households affected, and two-thirds of the 5,000 respondents said they were opposed to charging.

The introduction of Oxford's first paid-for residents' permits is due to begin next year.

The new permits will affect homes in 26 zones across the city, which will include Headington, Blackbird Leys, Summertown and Jericho.

David Robertson, the county council cabinet member for transport, said: "It's pleasing to note they're going to take the advice we gave anyway - and not going to waste ratepayers' money on a challenge that wouldn't have been successful."