As champagne corks popped around the Social and Liberal Democrat, the defeated Labour camp were consoling themselves with pints of beer.

The election defeat is a major blow for Labour, who lost not only the by-election seat, but now has, its council majority in Waltham Forest reduced to one.

Labour's Deputy Leader Bill Dennis commented: "We'll just have to be more careful about planning holidays. But we'll be able to carry on."

Last Thursday's by-election has also turned Leyton into an SLD stronghold.

With all three Leyton wards under Liberal control, financial journalist Mr Worsfold is confident that during the 1990 council election they will become the leading party.

"We have achieved an enormous amount in Waltham Forest in the last few years," he announced.

Surrounded by campaigners and supporters at the celebration drink-up at SLD headquarters in Church Hill, Walthamstow, Mr Worsfold said his first job would be to get a better deal for council tenants.

Delight(ed?) agent Councillor Philip Arnold called the win a "tremendous victory."

"The Conservatives have been humiliated in this election, and Labour did badly because they failed to oppose plans to relocate Spitalfields market in Leyton."

Labour's candidate John Wray looked mortified after losing his second by-election, but admitted: "I never expected to win and never felt confident.

"I always felt the Liberal Democrats would win -they're good at by-elections.

"I think the rates issue may have given them the majority, but it wasn't the deciding factor.