Surrey County Council has denied receiving a ‘sweetheart’ deal from the Government in return for ‘killing’ its referendum on proposals to hike council tax by 15%.

Labour leader Jeremy Corbyn caught Theresa May off guard during prime minister’s questions today by reading out leaked texts which allude to a secret deal between Surrey and Whitehall over its council tax plans.

The council denies any such deal took place.

The county council’s Conservative leader David Hodge had proposed to increase council tax by 15% in order to pay for social care. The plan was to be decided on by a referendum.

The council then suddenly announced yesterday it was withdrawing the proposed tax increase and, instead, had decided on a 4.99% rise.

'The Government has listened and we believe the Government now understands,' Mr Hodge said at the time.

However, Mr Corbyn revealed today leaked texts that had allegedly been exchanged between Mr Hodge and someone called ‘Nick’ who works for ministers in the department of communities and local government.

The first text reads: ‘I’m advised that DCLG officials have been working on a solution and that you’ll be contacting me to agree a memorandum of understanding.’

The second text said: ‘The numbers you indicated are the numbers I understand are acceptable for me to accept and call off the R…’

It continued: ‘If it is possible for that info to be sent to myself I can then revert back soonest. Really want to kill this off.’

After reading out the messages, the Labour leader asked the PM: ‘How much did the Government offer Surrey to kill this off and is the same sweetheart deal on offer to every council facing the same social care crisis created by her Government?’

Mrs May responded by accusing Mr Corbyn of using ‘alternative facts’.

The proposed council tax increase could have been embarrassing for both health secretary Jeremy Hunt and chancellor Philip Hammond who both have constituencies in Surrey.

Mr Hodge, who is also the Conservative group leader at the Local Government Association (LGA), denied the existence of any deal.

‘Surrey’s decision not to proceed with a 15% council tax increase was ours alone and there has been no deal between Surrey County Council and the Government,’ he said.

‘However, I am confident that the Government now understands the real pressures in adult social care and the need for a lasting solution.’

Commenting on the revelations, the Liberal Democrat shadow health secretary Norman Lamb said: ‘If ministers did reach a memorandum with Surrey Council, it must be made public immediately.

‘There shouldn't be a secretive, backdoor deal for a county which happens to have two Conservative cabinet ministers while other councils are left high and dry. 

‘The social care crisis does not end at the borders of Surrey.’