Two museums run by Northampton Borough Council have lost their accreditation status following a controversial decision to auction off an ancient Egyptian statue.

Northampton sold the 4,000-year-old statue of Sekhemka at auction earlier this month to a private collector, raising over £8m to fund extensions to its museums and art galleries.

However Arts Council England today revealed it has removed Northampton Museum and Art Gallery and Abington Park Museum – both managed by the town hall – from its accreditation scheme.

Arts Council England said its decision was ‘hugely regrettable’ yet concluded the process leading up to the sale of the artefact at auctioneers Christie’s was in contravention of its rules. The sites will now be excluded from the scheme for a minimum of five years.

Over the last 12 months, the Arts Council has contributed £25,000 to the digitisation of Northampton Museum’s shoe collection. Running costs for the site are thought to reach around £900,000 a year.

Yet Northampton Borough Council leader, Cllr David Mackintosh, said he was ‘confident’ the town hall would be able to attract funding from elsewhere for the museum’s extension and there would be ‘absolutely no reduction’ in the council’s current cultural offer.

‘It is disappointing that Arts Council England is removing the accreditation from Northampton Museum and also puzzling at a time when we are possibly one of the only local authorities in the country with plans for a multi-million pound investment in their museum service,’ Cllr Mackintosh added.

‘We do believe that we have followed the correct process in making this sale and so are considering an appeal and are taking legal advice on how to go forward.’

Scott Furlong, director of acquisitions, exports and loans unit at the Arts Council said: ‘I am confident that the museums sector and wider community will share our dismay at the way this sale has been conducted and support the decision to remove Northampton Museums Service from the scheme.

‘It is of great importance that the public retain their trust in museums to look after the collections held in their name.

'There is a very real risk that this trust, and particularly that of potential donors and funders, will be seriously undermined if disposals from public collections are seen to be driven by financial considerations and in breach of our professional standards and ethical code.’

Peter Knott, Director Midlands said: ‘The Arts Council and Northampton Borough Council have a long history of excellent partnership working. In this instance we have a substantive disagreement about the approach they have taken and we have expressed our misgivings during our dialogue with colleagues there.’