PUBS, post offices and village shops could have their council tax bills slashed under Tory plans to kick-start local economies.

Town halls would be able to intervene to save and protect specific sectors which they see as vital to sustaining community life.

The idea forms a key plank of the Conservative's Control Shift policy published today which aims to shift power back to local people.

It spells out plans to all but demolish the Regional Development Agency, give voters the ability to block big council tax rises and help Britain catch up with other European countries where local government is much more powerful.

Shadow Communities Secretary Caroline Spelman told the Western Morning News the plan to allow councils to give tax cuts to small firms was vital to protect their communities.

"Local authorities are frustrated with the loss of local businesses like the country pub or local post office," she said. "By giving all councils the power to discount business rates, they could actually help post offices and country pubs stay in business. It's up to them to choose which ways and by how much. The local council is far better placed than bureaucrats sitting in Whitehall to decide how to differentiate these rates."

The move follows growing concern about the rate at which once-common amenities are disappearing. The loss of vital services has often sparked a huge public outcry, not least when 140 post offices were axed in the Westcountry as part of Government cost-cutting. Other branches have closed since, blaming crippling overheads.

Thousands more small businesses across the region are also thought to be under threat.

Pubs are closing at the rate of six a day nationwide while the loss of big name stores in market towns threatens independent shops, warn experts.

The Conservative document says: "Councils lack the freedom to take decisions which deviate from central prescription but which could increase the social value of their communities – actions such as stepping in to save post offices or small shops."

However, any tax cuts for pubs and shops would have to be paid for from stretched council budgets. The Tories say they want to see "opportunity and power spread much more widely and fairly".

The party accuses Labour of overseeing the "rise of top-down central and regional government control" which has given people "too little say over decisions that directly affect them locally".

Even Labour ministers have previously admitted that "power remains too centralised and too concentrated in government hands".

The demise of the South West Regional Development Agency as it currently operates has been hinted at by senior Conservatives for several months. Under their plans, a Conservative government would repeal the laws which gives the RDA its powers, and leave councils across the region to decide if the body should continue and in what form.

However, key planning and housing powers will be returned to elected councillors who will be held to account directly for their decisions.

The Government will today announce it is making £340 million available to councils if they "up their game". The money will be shared between councils which club together with other services such as the police, NHS and Jobcentre Plus and deliver their most ambitious targets – "with a firm focus on making life easier and better for their residents".