National Statistics show that the number of people losing their homes fell by 15.6% in the last quarter of 2004 compared with the first.

They also show a 30% reduction over the last year in the number of households living in bed and breakfasts.

Leicester City Council and Broxtowe Borough Council were both singled out for their efforts.

'Vulnerable targeted'

Quarterly homelessness cases fell from 2,560 at the start of 2004 to 2,160 by the end of the year.

Authorities in Leicester and Broxtowe have been chosen to take part in the government's new Homelessness Regional Champions programme.

It will see them carry out peer reviews and action planning days with surrounding councils.

Councillor Maggie Garrett, Broxtowe Borough Council cabinet member for housing, health and leisure, said: "We've tackled the causes of problem and introduced a range of initiatives which target the vulnerable before they become homeless."