DURHAM is under new management after the Liberal Democrats sensationally ended Labour's 20-year grip on the city council.

The troubled authority's new masters, who campaigned against cronyism, mismanagement and secrecy, pledged a new style of administration.

Leader Sue Pitts said: "For too long Durham has been treated with contempt by Labour who behaved as if they owned the city."

The Lib-Dems won 30 seats, up 17 on 1999, while Labour saw its total of 32 seats collapse to 17.

The Independents maintained three seats but the Tories and the Durham Taxpayers Alliance finished empty-handed.

The Lib-Dems have been building their organisation and party membership and fielded candidates in all 50 seats for the first time. Labour, in contrast, could manage only 42 and saw support crumble in some heartland areas.

The Lib-Dems, who appeared to benefit from boundary changes, won all the seats in former pit areas including Shadforth and Sherburn and Brancepeth, Langley Moor and Meadowfield and took the new ward of Pelaw and Gilesgate - which includes the Sherburn Road Estate - in the city itself.

Labour leader Maurice Crathorne increased his vote in Coxhoe but saw senior colleagues including Stephen Laverick and John Bowman unseated elsewhere.

Coun Bowman was one of the victims in Shadforth and Sherburn as was former Labour deputy leader Mildred Brown who stood as an Independent, having resigned from the party in 2001 over an alleged racist remark.

The Lib-Dems' national leaders expected to take seats in Durham, but it was not a target council.

The council has been dogged by controversies such as the Millennium City land deal, the Sacred Journey film contract and the collapse with debts of £700,000 of the firm the council hired to run the Gala Theatre.

Coun Crathorne has stood down as Labour leader - he is now deputy - in favour of environment portfolio holder David Bell.

Coun Crathorne said: "We are disappointed. We thought it would be tight but we lost seats we shouldn't have, such as Sherburn and Pelaw and Gilesgate. It's difficult to know why it happened but they fought a better campaign."

Coun Pitts plans to examine the books closely before decisions are made on the council's direction.

The Lib-Dems do not officially take control until the annual meeting on Tuesday, May 20.

"I have instructed the chief executive to sign nothing," she said. "No contract is to be signed, no agreement is to be made and no compact is to be made.

"They have been running a scorched earth policy and have left us with very little. The funds are bad, the assets have been sold off, the staff are demoralised and there's a real negative picture, so we are starting from way back. We know what the people want."

Labour meanwhile will hold an inquest into the disaster. A Labour North spokesman said regional organiser Mick Hills would get involved after the constituency party had deliberated.

"There will be a debate about what lessons can be learned."

The election turn-out was 37.79 per cent, up five per cent on 1999.

The Lib-Dems also enjoyed success in parish elections, taking all seats on Sherburn and Witton Gilbert parish councils and all but one of the seats at Belmont.

* The new chairman of Durham County Council has been named as former miner Alan Fenwick, 72, of Seaham.