MULTI-MILLION-POUND plans to regenerate estates and build hundreds of new council homes in the city could be scaled down because of new Government rules, the Oxford Mail can reveal.

Oxford City Council is set to ‘pause’ a series of projects that would have been funded from April next year, in the face of a potential £36.5m gap in its finances over the next four years.

The Labour-controlled authority said it was because of changes announced by the Conservative government earlier this year, including a cut in social rents and an extension of the Right to Buy scheme.

It could mean major schemes, such as the regeneration of the Blackbird Leys and Barton estates, the building of 485 homes over the next 10 years, and plans to install solar panels on council home roofs, could be cut back.

City council deputy leader Ed Turner accused the Government of launching “an ideologically motivated attack” on local authorities.

Ministers have promised an extension of the Right to Buy to housing association tenants, but said the most valuable council homes must be sold when they become vacant to pay for the scheme.

This money would be given to housing associations to build replacement homes, but the city council said there was no guarantee that cash from sales in Oxford would be used to build new homes in the city.

In his July budget, Chancellor George Osborne also said councils would be forced to reduce rents by one per cent annually for four years, rather than allowing them to rise with inflation – a move that would drastically reduce the city council’s rental income.

Mr Turner told the Oxford Mail: “In Oxford we are desperate for more council housing but this will simply rip assets out of Oxford, with a real risk that money made from selling housing in the city will go to other areas where it is cheaper to build.”

He admitted that some schemes – such as the regeneration of Blackbird Leys – may have to be scaled back.

However, he did stress that they would not be abandoned.

Mr Turner added: “People should be in no doubt, we are determined to do the right thing by our estates and that includes doing the regeneration.

“We need to understand the detail of what the government is proposing, but at the moment we have to ask if it is sensible for us to build more council housing.”

The city council said its ‘pause’ of schemes did not apply to those it had recently committed to, such as the much needed refurbishment of the city’s tower blocks and the plans for bringing in the ‘Oxford Standard’, improving the quality of homes through work mainly on kitchens, bathrooms, and their energy efficiency.