The Government today announced Shropshire’s five remaining district councils will be scrapped and replaced by an all-purpose county council.

The decision means that from April 2009, the county will be split into two unitary authorities – Telford & Wrekin and Shropshire County – and new council elections will be held the following month in May.

John Healy, local government minister, said the Shropshire County Council-led bid for unitary status had been approved.

The decision will be a blow to Shrewsbury and Atcham Borough Council (SABC), which has been at the forefront of legal attempts in the High Court to block the move.

It recently decided to mount a fresh challenge at the Court of Appeal in January. However, that may be thrown into disarray as it was only on the basis it was joined by another council affected, Congleton Borough Council in Cheshire, which may now reconsider its position in light of the Government’s announcement this afternoon to defer its decision on that particular proposal.

The unitary plan still has to be approved by MPs in the House of Commons and peers in the House of Lords, which means there is still scope for campaigners to bring the unitary drive to a halt – as they did controversial proposals for police force mergers, but it is unlikely the move will be scrapped.

Tory MPs Daniel Kawczynski, for Shrewsbury & Atcham, and Philip Dunne, for Ludlow, opposed the abolition of their district councils after opinion polls showed a majority of voters were against being governed from Shrewsbury’s Shirehall.

Mr Kawczynski said: “A group of councils are taking this to the wire by taking the case to the Court of Appeal on January 28.”