Manchester and Blackpool may be granted licences for smaller casinos if the government goes ahead with plans to scrap the Manchester supercasino.

Plans for 16 smaller casinos were announced in January. These have been allocated to local authorities by the Casino Advisory Panel. James Purnell, the culture secretary, this week called for the councils that were recommended to confirm their continued interest in plans.

This is being interpreted as a signal that if any were to drop out, Manchester would be first in line to replace it. Blackpool, the other Lancashire town that pushed hard to host a supercasino, is also in the running to pick up any spare licences.

Architect Carey Jones has designed three casinos that have opened in the UK in the past three months. David Matthews, one of its directors, said: “A lot of the authorities that put in bids for the supercasinos deliberately didn’t bid for the other ones as they thought it would damage their bids, and have therefore been deprived of them.”

Although the future of the supercasino is in doubt, plans to build the smaller casinos are thought to be “99% certain”, according to one source.

Manchester council said it would continue to push for the supercasino and insisted that plans for it were “still on the table”.

The ultimate fate of the supercasino will not be confirmed until September, when a report by the Gambling Commission on problem gambling is released.

Last week Brown said the government needed to reflect on whether there may be “a better way of meeting [areas’] economic and social needs than the creation of supercasinos”.