SOARING North-East council tax bills have cancelled out state pension increases, the Conservatives have claimed.

The Tories yesterday produced new figures which they said showed how pensioners on fixed incomes had been hit as Labour allowed council tax to rise.

But Labour hit back by claiming Tory planned spending cuts would force schools across the region to sack more than 1,700 teachers and classroom assistants.

The Conservatives said the figures revealed that in the North-East, pensioners in the prime minister's Sedgefield constituency have been worst affected by higher council tax bills since 1997.

Single pensioners had seen pensions rise by £892 to April this year, but their council tax bills had gone up by £406 - swallowing up more than 45 per cent of the increase.

Labour counter-attacked on education, claiming that 1,713 teaching and classroom assistant jobs would be lost under the Tories' "pupils' passport" scheme. The idea would subsidise parents who want to place their children in more successful schools.

But Stephen Twigg, the Education and Skills Minister, said the "bureaucratic and costly" voucher scheme would slash £1bn from the schools' budget.

He said worst hit would be County Durham (453 jobs lost), Sunderland (284), Stockton-on-Tees (182), Gateshead (170), South Tyneside (151) and Redcar and Cleveland (147).