Stephen Byers has called for town halls to be forced to hold local referendums if they plan to raise council tax by more than twice the rate of inflation.

Speaking to a New Local Government Network seminar, the former Cabinet minister, who remains close to Downing Street, said: "Any proposal to increase the tax by a certain amount, say twice the headline rate of inflation (presently 5.2 per cent), should go ahead only after an affirmative vote from local electors.”