Lib Dem leader sees council power lost – even in his own back yard

The Liberal Democrats conceded defeat early this morning in the battle to hold on to the council in Nick Clegg's home city of Sheffield as the party's vote slumped across the North of England.

Party sources predicted they would lose as many as 12 of the 15 seats they were defending, handing control of city hall to Labour. The Liberal Democrat leader in Sheffield, Paul Scriven, said he feared the voters had "stuck two fingers up to the Government".

Labour sources also forecast they were heading for victory in Sheffield. The Liberal Democrats took power in Sheffield in 2008 and until last night ran a minority administration in the city, with 41 of the 84 seats.

Along with Liverpool, Newcastle and Hull – all areas where the Liberal Democrats were under pressure as counting got under way – the city came to symbolise the party's growing power base in the North of England.

Sheffield is also home to Mr Clegg's parliamentary constituency of Hallam and the Liberal Democrats chose it to stage their spring conference two months ago.

Unconfirmed reports suggested that the Liberal Democrats could lose 10 of the 12 seats they were defending in Hull, another of their flagship authorities. The Lib Dem council leader in Hull, Carl Minns, effectively admitted defeat when he said he would be "gobsmacked" if Labour did not make big gains in the city.

The party's support was also said to be collapsing in Liverpool and Manchester. Ken Ball, the leader of the Liberal Democrats on Chorley council, Lancashire, accused Mr Clegg of "letting the party down" and said he was so disillusioned he could resign from the party.

In the first result of the night, Labour tightened its grip on Sunderland council, where it won four seats from the Tories. It now holds 56 of the 75 seats on the authority.

The party also won the first declaration in elections to the Scottish Assembly, seeing off an SNP challenge in Rutherglen. However, in an early sign of how the political tide was flowing north of the border, Labour suffered a swing of 7.4 per cent to the Nationalists. The SNP gained East Kilbride moments later.

Labour will hope to capture a series of councils in the Midlands and the North of England, from the Liberal Democrats and the Tories, in election results due to be declared today.

The party is confident of winning Blackburn with Darwen, where it only needs to make one gain to take control of the Lancashire authority. The nearby council of Blackpool, which is currently run by the Tories, could be vulnerable to a large Labour swing.

The Conservatives are likely to hang on in Dudley, but only need to lose three seats in Walsall to lose overall control of its town hall.

In the South of England, the Tories are aiming to win the Liberal Democrat stronghold of Lewes, in East Sussex, where they need three gains from the Liberal Democrat coalition colleagues, and Winchester, where they have to make two gains to win control of the council.