This time it was merely a rout

The Conservatives were bracing themselves today for losses of 600 to 700 council seats after a night of electoral defeat which stopped just short of the meltdown feared in the Tory strategists' worst-case scenario.

A 2-per-cent increase over last year's catastrophic 25-per- cent share of the vote should go some way towards helping to shore up John Major's leadership during what promises to be a turbulent weekend. But it did not stop the results being the second-worst inflicted on the Tories in local-government history. Shortly after midnight they were fearing a casualty toll of well over half the seats they were defending and significantly worse than their best realistic hope of around 500.

Labour captured the glittering prize of Basildon Council, in the heart of what used to be Thatcherite Essex in a night which saw both opposition parties eat further into the Tories' base. But the Tories retained Macclesfield and even gained two seats in holding Mr Major's Huntingdonshire base.

Projections by BBC TV's Newsnight, based on key wards, showed the Tories at 27 per cent, but they were wiped out in Northern Labour strongholds like Manchester and Newcastle. The projections showed Labour's share of the vote down two points at 44 per cent and the jubilant Liberal Democrats up 2 per cent at 25 per cent.

Paddy Ashdown, the Liberal Democrat leader, said that it was a "very, very good night" for his party as it notched up gains for the sixth year in succession and party officials predicted more than 150 gains by the end of the night.

Repeated in a general election, last night's rout would propel Tony Blair into Downing Street with the biggest majority Labour has had since 1966. He said they were "spectacularly good results".

Michael Heseltine, the Deputy Prime Minister, insisted the remorseless toll was no indication of his party's performance in a general election a year away at most. He said that in 1986 the Tories lost 717 council seats and in 1991, 872 seats - and had then in both cases gone on to win the general election a year later.

John Redwood, now leader of the backbench Tory right wing, was quick to point out that the result showed the "worries and concerns the electors have about the Government and its policies, which must be put right before the general election." Mr Redwood, whose council in Wokingham fell to the Liberal Democrats, cited the key issues aggravating the defeats as the fall in NHS beds, law and order, and hostility to Europe, including the beef ban.

Large stretches of local government became Conservative- free zones, the Tories losing all their remaining councillors in at least 17 councils including Stevenage, Harlow, Oxford, Lincoln, Weymouth, Newcastle upon Tyne, Salford, Tamworth, Nuneaton, Cannock Knowsley, Wigan and Manchester, where the Conservative even came in behind a Friends of the Earth candidate in one ward. In Sheffield, they lost all but one of their four remaining councillors as the Liberal Democrat advance in the inner cities continued with six gains.

In Birmingham, the Conservatives lost 15 of the 21 seats they were defending.

With the final outcome still unclear, Labour said the results would be the worst or the second worst for the Conservatives in local-government history. Labour was even more encouraged by signs that it was doing disproportionately well in councils which cover its target parliamentary marginals, including Basildon, Lincoln, Harlow, Peterborough, Oldham and Rochdale.

Two of Labour's sweetest victories came in Basildon and Peterborough, the former theparliamentary marginal where David Amess's victory in the 1992 general election signalled Labour's defeat. Peterborough is both a parliamentary marginal and the seat of Brian Mawhinney, the Conservative chairman. John Prescott, Labour's deputy leader, said Mr Amess and Dr Mawhinney had "chickened out" by seeking seats elsewhere, because "they know these results will be reflected in the general election".

The Conservatives took some comfort from holding three of the four councils they were defending. They technically lost Runnymede, but are likely to run it on the casting vote of the mayor. They avoided the wipe-out some had predicted by holding Macclesfield.

It proved a good night for the Liberal Democrats, who also won in Tunbridge Wells, Woking, Poole, West Lyndsey and Hastings, where the battle was with Labour.

They also took North Somerset, which includes Weston-super-Mare, taking a seat from the Conservatives in a by-election after a recount.

They performed disappointingly, however, in some Tory areas such as Macclesfield.

Labour took control in Trafford, Hertsmere, Rochdale, Oldham, Basildon, Peterborough, Wyre Forest, Cherwell - the Oxfordshire council which includes Banbury's BSE-affected cattle market - and Cambridge. Poll support for Major, page 5 Results, page 6