Labour set to suffer a total meltdown in council elections

Fresh allegations about Chancellor's expenses expected as Vince Cable calls for him to resign

Labour faces being virtually wiped off the map in the county council elections this week, marking one of the lowest points in the party's history. Last night a poll of voting intentions at the next general election put Labour in third place.

In the ICM poll for the Sunday Telegraph, just 22 per cent said they intended to vote Labour, against 25 per cent for the Lib Dems and 40 for the Conservatives.

Senior Tory sources claimed last night that they are confident Labour's last remaining shire councils will fall to the Conservatives or to no overall control in polling day on Thursday.

Cabinet ministers also privately warned that the 4 June poll will be one of the worst in memory for Labour, going beyond the usual lowering of expectations by the governing party. It would leave Labour with no control of England's county council seats.

The claim by Tory officials that they could unseat Labour's grip in northern counties of Lancashire and Staffordshire, and leave Derbyshire and Nottinghamshire with no overall control, confirms the worst fears of ministers. It followed a poll in The Times yesterday suggesting Labour will come third in the European elections after the Tories and Ukip.

Meanwhile, last night's fresh expenses allegations were spread evenly between the two main parties. Former Liberal Democrat leader Charles Kennedy claimed for three tins of mints and two teddy bears from the House of Commons shop; Labour MP Frank Cook, Stockton-on-Tees, claimed a £5 donation at a church service commemorating the Battle of Britain; Shadow Scottish secretary David Mundell spent £3,000 on equipment for publicity pictures; Roger Godsiff, Labour MP for Birmingham Small Heath and Sparkbrook, claimed a bath mat, gardening equipment and more than £7,000 of repairs on office expenses; Tim Yeo, Tory MP for South Suffolk, claimed £900 for a pink laptop "in the weeks leading up to Christmas"; and Tory Bob Walter, MP for North Dorset, claimed more than £1,000 for handmade carpets.

And Conservative leader David Cameron faces questions of his own. The Mail on Sunday claimed he repaid a £75,000 loan on his London home – taken out six years before – shortly after taking out a £350,000 mortgage on a house in his Oxfordshire constituency, at public expense.

The election disaster that could be looming for the Prime Minister on Thursday makes it all the more likely that he will have to carry out a radical reshuffle of his Cabinet to try to reassert control. Alan Johnson, who is being urged by allies to prepare himself for an emergency Labour leadership if Mr Brown is toppled, could be promoted to Home Secretary in an effort to appease supporters, replacing Jacqui Smith who is already on the casualty list over her expenses.

Hazel Blears, Secretary of State for the Communities, is likely to pay the price for her highly critical article last month in which she ridiculed Mr Brown, although the Prime Minister has been warned by some ministers that, if sacked, she could "go nuclear" and call on him to go.

Further pressure on Alistair Darling, the Chancellor, is expected this week over his expenses claims. Liberal Democrat Treasury spokesman Vince Cable called for Mr Darling to be sacked for "flipping" his second home and having tax advice paid for by public funds. In an article for The Mail on Sunday, Mr Cable wrote: "Here is the company finance director caught with his fingers in the till. He doesn't explain. He doesn't apologise. He just blames his colleagues for not stopping him. His moral authority has vanished. He must go, now." Tipped to replace Mr Darling is Ed Balls, the Prime Minister's closest aide, who is currently Secretary of State for Schools.

Mr Cable dismissed reports that he could be in line for a job in the Cabinet under Mr Brown as a blatant strategy by Downing Street to try to stabilise the Prime Minister. He added: "I would not agree to be co-opted into a Labour government in its dying days."

In a separate development, MPs who have abused their expenses could be recalled by constituents. The measure looked more likely after David Cameron said he supported the move, which is already backed by the Lib Dems and under consideration by Labour. In an interview with Sky News to be broadcast today, Mr Cameron said he supports giving voters the power to recall their MPs.

But elsewhere there were warnings that other suggestions for reform, including proportional representation, were the wrong response to the expenses scandal. In an interview with the IoS, Lord Adonis, one of the leading proponents of PR, said it was not the answer. He said: "You don't deal with flu by taking malaria tablets."

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