COUNCILLORS and officials say the dream of a unitary County Durham council is not dead.

Despite people voting for one county-wide all-purpose council instead of three based on existing districts, a shake-up of local government will not happen because it was dependent on a 'yes' vote for the regional assembly.

Durham County Council backed the assembly and campaigned for one unitary council, which won by about two thousand votes overall.

Chief executive Kingsley Smith said: "The idea of three unitary authorities will never come back on the agenda, it is fair to say.

"They are absolutely dead in the water. The dream of one unitary authority lives on."

The council's Labour leader Ken Manton said local government reform would only be off the agenda for a few years. "So much money can be saved, so much money can be invested in services by having one unitary authority. We will be coming back, we will be arguing - certainly I will be - that we should press for a unitary authority."

He added that the council was working with parish councils on projects to devolve certain services to grass-roots level.

Liberal Democrat leader Nigel Martin said he hoped the unitary issue would return soon and would be taken up by the major parties at the General Election.

"There is a genuine issue of service to the local community as well as the financial savings."

Independent leader John Shuttleworth said people voted against the assembly because 'too many people had their noses in the trough' but there was support for an all-purpose county authority.

Durham City Council's new Liberal Democrat leader Fraser Reynolds has called on the Government to say whether local government reform could return in the near future.

The city would have merged with Easington to form an East Durham council under the three unitaries option. The city council had suggested an alternative proposal, creating a 'greater Durham', but it was not accepted by the Boundary Commission.

Coun Reynolds said: "I hope the Deputy Prime Minister will make a clear statement in the near future as to whether reorganisation of two-tier local government is still on the agenda as a separate issue and, if so, how this will be conducted and when it can be expected.

"The uncertainties of the last two years leading up to the referendum should not be repeated. The people of Durham deserve a definitive response on this subject from the Government."