Surrey County Council leader David Hodge has told how he secured a 'gentleman's agreement' with the Government to avoid an embarrassing 15 per cent tax hike.

Downing Street has repeatedly denied striking a ''sweetheart deal" with the Tory-run council to kill the double-digit tax rise.

But Mr Hodge told a private meeting that he had direct dealings with Communities Secretary Sajid Javid over its financial struggles.

In a recording leaked to the BBC, the council chief is heard telling Tories he was "looking for help on how we could stop a referendum" and "every leader ... will always have these conversations to try and get a better deal".

He added: "There may come a time that if what I call a gentleman's agreement, the Conservative Party often does, are not honoured, we will have to re-visit this in nine months or a year's time.

"If we do, let me assure you, you will have to drag me kicking and screaming not to go for referendum next year."

Labour leader Jeremy Corbyn confronted Prime Minister Theresa May in February with leaked text messages involving Mr Hodge that appeared to show negotiations over a deal.

The council leader had backed down over plans to hold a vote on the massive tax hike and put forward plans for a 4.99 per cent rise instead.

A spokesman said Surrey Council stood by its previous statement that there had been no deal.

A Department for Communities and Local Government spokesman said: "As we have repeatedly made clear, there was no special deal for Surrey County Council and they will not receive any extra funding that would not otherwise be provided or offered to other councils. To imply the opposite is simply untrue.

"Surrey County Council informed the Government it wanted to become a pilot area for the 100% business rates retention scheme.

"DCLG made clear this was not possible for 2017/18, but subject to meeting the necessary criteria, it could apply in the 2018/19 pilot.

"As part of the statutory draft Local Government Finance Settlement consultation, DCLG discusses local government funding with councils across the country, of all types and all political parties.

"This happens every year, involves councils making representations to the Government, and has always been the process."

Cllr Hazel Watson, Leader of the Liberal Democrats on Surrey County Council, said: "I am horrified that despite huge public opposition the Leader of the Council is talking about a referendum and a large council tax rise next year - he has clearly not listened to local residents.

“The transcript of the Conservative group meeting begs the question: What does the Leader of the Council have in writing?

"It suggests a deal between the Conservative administration at Surrey County Council with the government and that the Leader of the Council wants to keep it under wraps. This contradicts his previous statements denying that a deal had been done with the government.

“These secrets do not do anyone any favours in local government. What is needed is a long term solution for the funding gap for adult social care and how we fund services across the country."

Shadow local government minister Gareth Thomas said the PM must "come clean" over the deal.

He added: "This recording proves what we have long suspected. The Government came to a secret 'gentleman's agreement' with the leadership of Surrey County Council, whilst the rest of the country faces a crisis in social care and brutal cuts to council budgets.

"Theresa May and her ministers, including Sajid Javid, have been playing political games, conducting backroom sweetheart deals for their friends, whilst councils across the country struggle to cobble together the money to adequately fund social care."

At Prime Minister's Questions today (Wednesday, March 8), Labour leader Jeremy Corbyn asked Theresa May about the 'gentlemen's agreement'.

Mrs May replied: "If he is asking me if there was a special deal made for Surrey that was not available to other councils the answer is no."