DURHAM City Council will continue running the Gala Theatre for the foreseeable future.

The authority took over in May when the management company it appointed crashed with debts of £700,000.

It gave itself 13 weeks to decide the £14m venue's future management but will now maintain control for an unlimited time.

Four national theatre firms have expressed interest in running the Gala and the council says it wants to carefully consider all options.

The decision was taken by the council's cabinet, which met in private on Wednesday even though no sensitive financial information was disclosed.

The move was criticised by cabinet member and Liberal Democrat leader Sue Pitts who said: "Basic Liberal Democrat policy is openness at all times. It is people's money and I don't think that any of the discussion was particularly confidential."

She welcomed the council's continued stewardship, saying that it was important that the right decision was made.

She praised officers for putting in unpaid time to establish management systems for the theatre but said it could not continue indefinitely and that it may need subsidising.

"Labour always swore it wouldn't cost the council taxpayer a penny. If the Gala can achieve all the things it should achieve I see no reason why we shouldn't be supporting the theatre.''

A council spokeswoman said: "We are going to keep it going for the foreseeable future to allow a full investigation of all the options.

"They could include other management companies or bringing in specific staff, perhaps an artistic director.'' She added that the theatre was currently doing well.

The council's Labour leader Maurice Crathorne has said he would be 'surprised' if the Gala did not need a subsidy.

The Entertainment Team (Durham) Ltd went into liquidation shortly after The Queen officially opened the theatre, with debts to 150 creditors. The council has said it might take legal action to recover a £75,000 loan to the firm made on the guarantee of its two directors.