AS local authority leaders fear being financially squeezed by Labour in this year's annual council tax settlement, Political Editor Graham Dines looks at what Labour may have in store for the future of local government.

AS local authority leaders fear being financially squeezed by Labour in this year's annual council tax settlement, Political Editor Graham Dines looks at what Labour may have in store for the future of local government.

POLITICIANS at Westminster can't resist messing around with local government. It doesn't matter which party is in power, ministers and MPs love to redraw the administrative map of England as if counties and towns were peopleless pieces on a giant chessboard.

For decades, county councils were the backbone of local government throughout Britain, alongside self-governing county boroughs.

The first erosion took place in the reform of the government of London in the 1960s. Middlesex and London county councils were abolished, their powers absorbed by the Great London Council which also clawed itself across chunks of Essex, Kent and Surrey.

Eleven years down the line, all county boroughs and traditional counties were replaced by super shire counties in "rural" England and Wales and metropolitan counties and boroughs in the urban heartlands of the north and midlands.

In Scotland, counties and ancient royal burghs were swept away to be replaced by amorphous regions.

The 1970s reform of local government brought us such wonderful administrative units as Central Region (in the heart of Scotland), Clwyd and Powys in Wales, Avon, Humberside, and Cleveland shire counties in England, and the metropolitan counties of Tyne and Wear, West Midlands, Greater Manchester, Merseyside, West Yorkshire, and South Yorkshire.

Civil servants and Conservative politicians redrew the map, removing counties such as Wigtownshire and Perthshire in Scotland, Montgomeryshire and Flintshire in Wales, Huntingdonshire, Rutland, the Yorkshire ridings, Herefordshire and Worcestershire in England.

Twelve years later, and the politicians were at it again. Margaret Thatcher wanted to rid London of Ken Livingstone so abolished the GLC, adding for good measure the metropolitan counties.

After years of lobbying, the Tories later restored all purpose powers to our great cities including Portsmouth, Derby, Leicester and Bristol, which had been reduced to mere shire districts in the 1974 reforms.

Unitary authorities were then created, including Southend-on-Sea and Thurrock in Essex, Luton in Bedfordshire, and Peterborough, which had been proudly included in the Soke in Northamptonshire until 1974 when it was arbitrarily moved into Cambridgeshire.

John Major's government scrapped the Royal County of Berkshire, handing its powers to four unitary authorities.

Finally, as part of its devolution strategy, the Government restored an overarching administrative unit to the capital – the Greater London Authority, with a directly elected mayor.

Local government administration in Britain is, quite frankly, little more than a mess. Councillors and council officials have to make it work, masking a situation which would not be tolerated in France or the United States.

In the incoming Tony Blair administration of 1997 worked out a way of bringing in a uniform system of local government in England outside London. The solution was simple – replace all counties and districts with a single tier system of unitary authorities.

The downside was that they would be subservient to remote regional authorities as part of the great devolution game.

Public hostility to the idea culminated in last year's referendum defeat for regional government in North East England.

Suffolk Coastal MP John Gummer, who as Environment Secretary was responsible for the upheaval in Berkshire, fears the Government's end game is to bring in urban dominated city regions to replace counties and districts.

"In Suffolk, that would mean a greater Ipswich. But it won't work and won't be loved by voters," he insisted.

"It worked in Berkshire because it was dominated by Reading which effectively cut the county in two. Creating unitary authorities to counterbalance Reading was the right solution.

"In Suffolk, the distances are greater. Suffolk Coastal stretches 69 miles from north to south – to have the Government impose domination by Ipswich would be a nonsense.

"If local government has to be reformed, then I would favour unitary counties and I suspect the people of Suffolk, given the choice, would back that. In tandem with this, meaningful powers could be devolved down to parish and community level."

That might be fine in Suffolk – indeed, it was the choice of the voters of County Durham when offered a say as part of the regional referendum last year – but it is a relatively unpopulated county.

Essex is a different story. Replacing the present shire county, Southend and Thurrock with one unitary county, would make the authority so powerful that it could challenge the Government in the same way as the former GLC took on Margaret Thatcher.

Creating five unitary authorities in Essex would probably suit Whitehall – John Gummer's city regions based on Colchester, Chelmsford, Southend, Harlow and Thurrock-Basildon.

There is a growing feeling in local government that the county council elections last May were the last. That gives ministers and civil servants until 2009, when the next county elections are due, to put and town and county halls through yet another massive upheaval.

Lord Hanningfield, the influential Leader of Essex county council, thinks plans could be unveiled next summer. "The Government wants fewer councils. That means a wholesale reoganisation that will affect all current arrangements."

Labour's regional agenda may be in tatters. But the preferred layer underneath – all purpose authorities, or city regions – could well be with us before the end of the decade.

But at what price? One thing's for certain – the rate of council tax won't go down.