What legacy will Labour leave when it loses power? For its ministers and MPs, that question looms in the far distance, with the next general election probably not for three years and the current political fragmentation making its outcome almost impossible to predict. But for many Labour councils, facing the electorate in less than three weeks with the party catastrophically low in the polls, now is a time for desperate campaigning mixed with private contemplation of a bleaker, quite possibly powerless future.

Energetic and effective Labour councils may meet the same fate as complacent and mediocre ones, as local elections often follow national trends. The last time an unpopular, midterm Labour government faced such ominous local contests may have been many decades ago, in 1968. Then the party lost more than three-quarters of its councils in London alone, including traditional strongholds such as Hackney, Islington and Camden. Across Britain today, Labour activists and councillors are talking to each other in anxious mutters about a national wipeout happening again.

One of the Labour councils that may be swept away is arguably the most innovative in the country. In its efforts to push through radical reforms, sell them to the electorate and embed them in society – so that at least some will endure if it loses office – the limits and also surprisingly large possibilities of the supposedly dusty, diminished business of local government have been vividly apparent. And so has the inconsistency of the national Labour party towards new ideas that might revive it.

For more than a decade, the small hilltop city of Preston in Lancashire has been the site of a leftwing experiment in taking back control. Its council has redirected much of its spending towards local companies, persuaded businesses to pay higher wages and promote diversity, collaborated closely with local public sector institutions and encouraged cooperatives and other collective enterprises that empower residents. It has sought to turn a rundown, ex-industrial place previously dominated by outside corporate interests – the kind of place found across Britain – into a more self-reliant, dynamic, democratic and equal city.

“The Preston model”, as it’s reverently known in leftwing and municipal government circles, has attracted attention around the world. In 2023, the medical journal the Lancet found that after the introduction of the council’s policies, “the prescribing of antidepressants and prevalence of depression decreased” in Preston, and residents “experienced a 9% improvement in life satisfaction and 11% increase in median wages … relative to expected trends [in] other similar areas”.

When I visited the city in 2019 and again last week, its central streets were more bustling, with more independent businesses and better maintained public buildings and outdoor spaces, than in many comparable places. Last Monday, the council leader since 2018, Matthew Brown, took me to some of the many enterprises his administration had supported or initiated: a cooperatively run yoga studio, a new council-owned cinema and “the only cooperatively managed Travellers’ site in the country”. Preston still has problems such as concentrations of poverty and vacant, decaying buildings, but it also has prospects.

Yet the council’s achievements have not insulated it from Labour’s wider difficulties. In 2018, during Jeremy Corbyn’s leadership – which loudly supported the Preston experiment – Labour held 35 of the city’s then 57 council seats. Now it holds only 26 out of 48, giving it a majority of just four, and next month may lose seats to the Liberal Democrats, Reform, the Conservatives or the Greens. Were Reform to capture the council (last year it took Lancashire county council from Labour), the Preston model might quickly unravel. “I think very little of it would survive,” Brown told me. “Or a lot of it would move to the grassroots level” – to community organisations enacting social change by themselves, without the council’s help.

Before the May elections, the council has hurried through funding assistance for a new ethical bank, North West Mutual, which from 2027 plans to provide accounts and loans specifically to individuals and businesses in the region, and to have a much more equal pay structure than other banks. Like many of the council’s projects, amid the restless flows and vehicles of global capitalism, the bank’s localism can sound old-fashioned. But global capitalism isn’t working well for most people in Preston or the wider world. And the bank is influenced by long-established, more patient business institutions, such as Germany’s regional banks. With rightwing populism surging in places with dying high streets and disappearing local pride, the Preston model seemingly offers a way to reverse all these trends.

“We’ve been inspired by Preston, and everything that Matthew Brown has done,” says Andy Burnham, mayor of Greater Manchester. Yet since the end of Corbyn’s leadership, the interest in it from Labour nationally has been minimal. Under Keir Starmer, the party has generally been incurious, and often outright hostile, towards promising new policies and ideas from the left – despite the absence of them from the Labour right and the party’s urgent need for fresh approaches.

Some of this attitude can be explained by Starmer’s scorched-earth approach to anything associated with Corbyn’s tenure, but the problem goes deeper. Historically, the centralising, often conservative Labour hierarchy has often been suspicious of Labour people doing bold things in local government. During the 1980s, when the national party was struggling against a dominant Margaret Thatcher, it nevertheless remained cool towards the relatively popular, Labour-run Greater London Council (GLC), which was reshaping the capital’s infrastructure, social attitudes and sense of itself in radical and lasting ways. One of the GLC’s key figures was Valerie Wise, who chaired its strongly feminist women’s committee. She is now an important member of Brown’s administration in Preston. “I only came on board because it’s radical,” she told me.

No political project lasts for ever, though, and radical ones often last less time than others. “I’m quite philosophical about this coming to an end,” Brown said. Eight years leading a reforming council is unusual – and exhausting.

But then he went back into his usual upbeat mode. There was so much more for the council to do, he said. “We’re fighting to win.” With the electorate so split, surprising Labour councils may survive May’s elections. Or, as with the GLC, which Thatcher abolished in 1986, some of their people, policies and ideas may carry on in new ways. The problem with cities, from a conservative point of view, is that they don’t stand still.

• Andy Beckett is a Guardian columnist