THE council was sensible not to draw on reserves to fund tax cuts, according to a local government expert.

Liberal Democrats urged Labour-led Durham County Council to use reserves to keep what they said was a promise to reduce council tax to that of the lowest district authority.

But Martin Laffin, professor of public policy and management at Durham Business School, said this "would probably be a short-term expediency" - and he added that a zero per cent tax rise would have been very expensive.

Prof Laffin said the public sector was facing a £47bn budget squeeze from 2011, and councils would be asked to take their share, so it would be sensible to manage budgets conservatively.

"Reserves are there for something unexpected in the future," he said.

"If you spend your reserves, they're not there for the future. Everything has changed completely with the credit crunch.

"Most experts assume that the public sector will go through a period of up to ten years of financial constraint, from 2011.

"My guess is the council is already feeling the impact of the credit crunch, with lower council tax returns, lower interest rates and falling user fees from facilities such as leisure centres.

"If this was just a fluctuation it would be OK. But were expecting a significant fall in central government support from 2011, so the council has to assume that its finances are going to be tighter than they are now."

On the council tax pledge in the unitary authority bid document, Prof Laffin said: "The bid seems to say in 2009 the council would bring council tax down to what the lowest districts charge would have been - but it's very difficult to estimate what that would have been."

He added: "It would be unrealistic to hold the present leader to a financial commitment made two years ago."