A row over gypsy and traveller sites sparked controversy in the council chamber this week as Conservatives were accused of “swerving close to the racist attitudes which ultimately led to the Holocaust”.

The bombshell accusation made by human rights campaigner Councillor Sarah Bevan – whose Jewish ancestors were persecuted in Nazi concentration camps – risks triggering a wave of official complaints from politicians about each others’ behaviour.

Ms Bevan (Lib Dem, Peasedown) attacked a move by opposition Tories to block the allocation of £1.8 million for the development of new gypsy and traveller sites in B&NES.

The Conservatives said the money could be better spent on services such as affordable housing and pointed out money was being cut from the road maintenance budget.

Ms Bevan told the meeting: “If the Conservative group en masse, as quoted by its leader in the media last week, believes that those who hold the purse strings should prioritise potholes over people, some of whom may well be members of minority groups such as the Romany, it is swerving perilously close to the kind of low level, insidious racism that ultimately led to the Holocaust.”

Her comments sparked a strong reaction from the chamber as the opposition called for her to take back the remarks.

Councillors were asked if they would like to make formal complaints about the comments and Councillor Dave Laming (Con, Lambridge) said he would be doing so.

Conservatives say the ruling Liberal Democrat administration could not justify allocating the money before a site or sites had even been identified but they failed to stop the money being included in the B&NES budget.

Mr Laming said his complaint would now be dealt with by the council’s processes.

He added: “I believe we were entitled to question why the controlling Liberal Democrat cabinet were not spending £1.8 million on affordable housing, and also thought our amendment was nothing more than common sense and logic.

“After all I have a duty of fairness to my constituents.

“It was also very disappointing that the Liberal Democrats chose to lower the tone of the debate on this with completely unfair and incorrect accusations.”

Other Liberal Democrats expressed anger at the Conservative move and Councillor Tim Ball (Lib Dem, Twerton), cabinet member for housing, said they were “irresponsible and reckless”.

After the meeting Mrs Bevan said she stood by what she had said.

No stranger to controversy, she provoked an angry backlash in 2010 after criticising the selection, by the council of which she was then chairman, of the Duchess of Cornwall as guest of honour to turn on the city’s Christmas lights.

At the meeting on Tuesday, Tory group leader Councillor Francine Haebering (Con, Saltford) said the allocation of money – to be spent over the next three financial years – was premature.

“We recognise that the council has a responsibility to search for potential sites and, if they are found, to allocate them as appropriate through the planning process. However, we currently have no sites allocated and so we question the premature timing of this proposal.

“The council is not awash with money, and £1.8 million is a very large amount when considering the council’s main priorities.

“We believe that now is the time for us to be investing in new housing and supporting local families.”

All of the broad brush proposals put forward by the council’s cabinet were agreed at the annual budget meeting, where the authority agreed a £1 million reduction in what it calls frontline services, as part of an overall £12 million savings drive.

The B&NES share of the council tax for an average Band D property will be frozen at £1,201.85.