Clegg delighted by party's unexpected wins

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Nick Clegg was celebrating yesterday after the Liberal Democrats appeared to have pushed Labour into third place, made gains in council seats and seized control of four target local authorities.

Projections by the BBC put the party at 25 per cent of the vote, a point down on the last similar set of elections in 2004, but enough to push Labour into a humiliating third place. Party officials said they were confident that their second place would be retained when full results were analysed. The party held the 137 gains it made in the 2004 local elections at the height of controversy over the Iraq war and university top-up fees, and added net gains of around 20.

Party officials were delighted they had held the flagship city of Liverpool, albeit only because of the last-minute defection of an independent Labour councillor to the Liberal Democrats.

The party also celebrated gains on Mr Clegg's home turf, Sheffield, as well as Hull, Burnley and St Albans.

Overall, it retained control of nine authorities, lost Pendle and West Lindsey, but gained four. In total, yesterday's results left Liberal Democrats with more than 4,200 council seats, more than 21 per cent of the total.

Mr Clegg described the elections as "a very strong result". He told the BBC: "We have increased the number of councillors when I was being told for weeks we were almost certainly going to lose them. We outpolled Labour for only the second time in our history and have been winning against both Labour and the Conservatives."

Lord Rennard, the party's chief executive, said: "We were not expecting to outpoll Labour ... and that is quite remarkable."

Lord Rennard said the party had made gains in bellwether seats such as Cheltenham and were just short of overall control in a series of others. He added that the Tories had failed to make headway in straight battles with the Liberal Democrats.