The Prime Minister,who was taking a question from the Labour Party leader, was left chuckling after Mr Corbyn challenged Mrs May over the Conservative-led council.
The leader of Surrey County Council told colleagues he had secured a “gentleman’s agreement” with the Government over funding for social care, a secret recording appears to show.
David Hodge appears to tell other council members that he had a conversation with Communities Secretary Sajid Javid in a car outside Downing Street.
According to the tape obtained by the BBC, Mr Hodge told colleagues at a meeting on February 7 that Mr Javid then spoke to Chancellor Philip Hammond about Surrey’s calls for extra funds to prevent the council from holding a referendum to prevent local tax hikes.
Theresa May roared with laughter during PMQs
He said I didn’t answer the question about a special deal for Surrey – I think I’ve answered it three times
Challenging the Prime Minister, Mr Corbyn said: “Mr Speaker, my question was about the arrangements between the Government and Surrey County Council.
“A recording has now emerged , saying the leader of Surrey County Council, David Hodge, said there was a ‘gentleman’s agreement’ between him and the Government, which meant they would not hold the referendum.
“My question is: what deal was done with Surrey County Council? Because there is an acute social care crisis, that affects every council…”
Mrs May instantly rebuked her counterpart, suggesting he should wait for the Budget announcement in order to find out the answer to his question.
However, the Labour leader wasn’t content with the answer to his question and proceeded to ask the Prime Minister to place a record in the Commons, before suggesting she may not even be aware of the potential arrangement.
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In response, Mrs May let out a furious laugh as the rest of the Tory benches jeered Mr Corbyn after he asked his question for the third time, he concluded: “she’s not keen on answering questions on that that”.
Prime Minister's Questions: Key Moments Wed, March 8, 2017
All the highlights from Prime Minister's Questions: March 2017
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Prime Minister Theresa May laughing along with Welsh Secretary Alun Cairns (left) and Chancellor Philip Hammond during Prime Minister's Questions in the House of Commons
Mrs May responded: “Can I just say to the Right Honourable Gentleman, really, he should listen to the answers I give before he asks the next question.
“He said I didn’t answer the question about a special deal for Surrey – I think I’ve answered it now three times, but I’ll do it a fourth time.
“There was no special deal for Surrey that was not available for other councils.”