CAMPAIGNERS were claiming victory last night after the Government rejected Thames Water’s plans to build a £1bn Reservoir in Oxfordshire.

But water company bosses could come back in the future with a scheme for a smaller reservoir.

The decision by the Department for Environment, Food and Rural Affairs (Defra) follows a public inquiry last summer into how the company aims to meet predicted demand between 2010 and 2035.

The reservoir was due to be built near Abingdon.

Iain Brown, county councillor for Hanneys and Hendred, said: “I have always said a reservoir in this area should be the last resort and not the first option.”

Helen Authers’ home in Hanney Road, Steventon, would have been demolished under the plan.

The mother-of-two, 44, said her family was putting their house on the market next week as the threat would probably never go away.

She said: “It has been our bête noire for so many years that I just want to get away from here.”

Wantage MP Ed Vaizey said the decision was a victory for campaigners and politicians.

He added: “I’m very pleased that the planning inspector has taken on board the concerns of residents and that the Secretary of State accepted these concerns. Thames Water will have to now look at a much wider range of options.”

Campaign group Gard (Group Against Reservoir Development) issued a statement saying Thames Water’s proposals have been rejected for the “immediate future”.

Spokesman Brigadier Nick Thompson said: “The Secretary of State’s ruling means that Thames Water must now investigate fully and objectively several alternative long-term water resource proposals, including a Severn-Thames transfer.”

Yesterday Vale of White Horse District Council said it welcomed the decision to axe plans to build the reservoir between Drayton, Steventon and East Hanney.

Tony de Vere, leader of the council, said: “We have always argued that the case for this reservoir has not been made and that it is not needed.”

A spokesman for Defra said: “The Secretary of State proposes to direct Thames Water to undertake further work prior to publication of its plan.

“This will include removal of the current proposal for a reservoir at Abingdon from the preferred programme, and further work to develop a new preferred programme, which may include a smaller reservoir as an option.”

Martin Baggs, Thames Water’s chief executive, said: “We supply water to 8.7 million people. For the next 15 years our plan aims to provide almost all of the additional water our customers will need through demand management.”

A statement from Thames Water added: “The inspector has asked the company to develop a proposal for a smaller reservoir at Abingdon, which will be one of a number of options available to us.”