THOUSANDS of public sector workers are anxiously awaiting the outcome of a challenge to plans for North-East super-councils, which reached the High Court yesterday.

Their futures depend on the outcome of a council's objection to the Government scheme, which would usher in a unitary authority covering all County Durham.

Shrewsbury and Atcham Borough Council, in Shropshire, says that the Government had no right to approve the plans and wants them thrown out.

It says the then Secretary of State, Ruth Kelly, pre-empted powers her successor will be given in autumn.

Legal arguments got under way yesterday, at the Royal Courts of Justice in London, before Mr Justice Underhill.

Evidence is expected to be presented and the hearing closed today.

Leaders of County Durham's seven district councils, who have launched their own legal challenge, are also eagerly awaiting the result.

Earlier in the summer, the districts held a referendum on the proposed shake-up. Of the 40 per cent who responded, 76 per cent rejected the scheme.

Councillor Fraser Reynolds, leader of Durham City Council, said: "We've got a clear mandate from the people of County Durham who are opposed to this unitary council, and we are very keen to see what happens in court.

"We have filed our legal challenge, but we hope that this challenge is successful and then we will look at what we do next.

"All our council employees, who are valued staff members, are facing a very uncertain future.

"It's unfair. There has been little consultation with staff, they haven't asked for it and it seems the Government is making this up as it goes along."

In July, Communities and Local Government Secretary Hazel Blears backed nine of 16 national bids for unitary status, including those from County Durham and Northumberland.

A similar proposal for North Yorkshire was rejected.

Elections to shadow councils could take place as early as next May.

Durham County Council says that 4,000 people employed by district councils would transfer to the new authority, to be called County Durham Council, with about 180 jobs being lost..