The Conservatives gained a much-needed foothold in the North West by taking Chester and becoming the largest party in Bury.

They failed to make the breakthrough David Cameron had hoped for when they did not gain a single seat in the Northern urban cities, such as Manchester.

Despite early signs of big gains for the Tories in the South and the Midlands, Mr Cameron will be disappointed that his party failed to take overall control of Bury, one of their key targets in the North. The metropolitan borough council was regarded as a litmus test for Mr Cameron’s style of leadership and the prospects of the party across the north of England as a whole.

The party managed only to limp into the lead at the expense of Liberal Democrat gains over Labour, resulting in no overall control and ushering in an uncertain period of political horsetrading.

Before last night’s poll, the council chamber was on a knife-edge. Labour had been holding off the Conservatives by only one seat, 23 to 22, to the Liberal Democrats’ six councillors. Last night, the Conservatives gained one seat while Labour lost two to the Liberal Democrats.

During the campaign, the Labour Party’s strategy had been to remind traditional supporters that they were voting on local issues for local services and that it was not a referendum on Tony Blair’s period in office.

David Chaytor, the Labour MP for the key marginal Bury North, even acknowledged that voters on the doorsteps believed that the Government had run out of steam. He suggested that it was now paying for the war in Iraq, Tony Blair’s long withdrawal from Downing Street and the difficult and confusing period before improvements in public services, notably in the health service, start to be felt.

The result is likely to be greeted with dismay by senior Tories in Westminster at a time when Mr Blair’s popularity is at a low ebb. Bob Bibby, the Conservative leader, ushered in a period of uncertaintly when he pledged that there would be no deals with the Liberal Democrats.

He said: “The actual vote has held up from last year, which I am very pleased about. We won one seat from Labour and we did expect more, but we only lost one by four votes.

“We would have liked to have had more obviously but next year we will have the result we expected tonight. I am not disappointed. We have a big battle in the cities and obviously in the North West. I think David Cameron can look to Bury as an example of where he hopes to go”.

Wayne Campbell, the Labour leader, said: “Tonight’s election was to do with local issues but the Tories have tried to turn it into a national election. They made it about Cameron and it has totally backfired on them”.

The Tories seized Woking from the Liberal Democrats but failed to take control of Maidstone, Kent, in a night of mixed fortunes for the third main party. They were also delighted after taking Gravesham in a straight fight for Labour and were heading for victory in Dartford.

The Tories had a minor setback in Hastings, where they lost the council to Labour after a council by-election, but they held Great Yarmouth and Southend-on-Sea.

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