This year's council tax increases in England could be the lowest for more than a decade because of an extra £1 billion government grant in the run-up to the election.

But council leaders say many authorities are facing a "black hole" in finances as government funding is fed directly to schools.

The local government minister, Nick Raynsford, said on Sunday that average rises are currently running at 4.5 per cent.

Some councils are likely to post "zero rises", he said.