Ministers are poised to take over the running of Liverpool City Council in response to widespread allegations off corruption.
Robert Jenrick is considering sending in commissioners to take control of the day-to-day running of the authority as a property development scandal unfolds.
The unprecedented move would see officials sent to assume control of the local authority.
In December Joe Anderson, the Labour mayor, and four others were arrested on suspicion of conspiracy to commit bribery and witness intimidation. None of those arrested have been charged. A Merseyside Police investigation into building and development contracts in the city is continuing.