Local Government Reorganisation

Statement

The following Statement was made in the House of Commons on Thursday 16 July.

“This Government are driving the most ambitious programme of local government reform in a generation by replacing the inefficient two-tier system with new unitary councils so that all parts of our country are ready for devolution. We need to devolve power out of Whitehall so that we can rebalance wealth, power and opportunity right across the country. This is the second richest country in Europe, yet England has seven of the 10 poorest regions in northern Europe. That is the case for change.

“This Government are driving the most ambitious programme of local government reform in a generation by replacing the inefficient two-tier system with new unitary councils so that all parts of our country are ready for devolution. We need to devolve power out of Whitehall so that we can rebalance wealth, power and opportunity right across the country. This is the second richest country in Europe, yet England has seven of the 10 poorest regions in northern Europe. That is the case for change.

Devolution requires strong local councils that deliver good public services and support economic growth, and which are closely connected to the communities they serve. Two-tier structures are confusing for residents, divide responsibilities, slow down decisions, duplicate costs and blur accountability. In many areas, existing boundaries no longer match patterns of local economies, public services or local identities. We cannot continue with an outdated and misaligned system that does not serve local people well. We can do better.

Today I am announcing further decisions on local government reorganisation in the remaining areas of the programme. Subject to parliamentary approval, I have decided to implement proposals for new councils in the following areas. In some of these areas, modification powers will be used to make the boundary changes requested alongside proposals.

The specifics are in the accompanying Written Statement, and for ease I will refer to the proposals in the following shortened form: in Derbyshire and Derby, the two-unitary option put forward by Chesterfield, Derby, Erewash and High Peak, including boundary changes; in Devon, Plymouth and Torbay, the four-unitary proposal put forward by Exeter and Plymouth, including boundary changes; in East Sussex and Brighton and Hove, the two-unitary proposal, including the boundary changes requested by Brighton & Hove City Council, except for the parish of Falmer; the one-unitary proposal in Gloucestershire; the four-unitary proposal in Hertfordshire, including boundary changes, except for the ward of Arbury; in Kent and Medway, the four-unitary proposal put forward by Dover, Swale and Thanet; in Lancashire, Blackpool and Blackburn with Darwen, the four-unitary proposal put forward by Chorley, Lancaster, Preston, Ribble Valley, South Ribble and West Lancashire; in Leicestershire, Leicester and Rutland, a two-unitary option put forward by Leicester City Council, including boundary changes; in Lincolnshire, North Lincolnshire and North East Lincolnshire, the four-unitary proposal put forward by Lincoln City Council, including boundary changes, but leaving North Lincolnshire and North East Lincolnshire unchanged; in Nottinghamshire and Nottingham, a two-unitary option put forward by Nottingham City Council, including boundary changes; the three-unitary proposal in Oxfordshire, including boundary changes; in Staffordshire and Stoke-on-Trent, the two-unitary proposal put forward by East Staffordshire, Stafford and Cannock Chase, but also by Stoke-on-Trent; the two-unitary proposal in Warwickshire; and the two unitary proposal in Worcestershire. On Cambridgeshire and Peterborough and West Sussex, I am not making announcements today, because further time is required to get the decisions right.

Everyone involved wants to see stronger local councils delivering better local services that will improve the lives of the people we serve. The decisions announced today will do that, and improve local government for more than 15 million people. We will see 38 councils operating across these areas in place of the current 134. That will result in more than 250 fewer senior posts, significant salary savings and nearly 3,000 fewer councillors, which could save up to £20 million per year on councillor allowances alone across these areas. Councils themselves projected that the decisions could lead to net savings of about £1 billion by the end of 2032-33 when the anticipated benefits are fully realised. Those savings will be reinvested in the front-line services that local people care about the most. Across England, once all decisions are taken, we will have cut the number of councils from 317 to a maximum of 173. That will simplify and strengthen local government serving over 20 million people.

Everyone involved wants to see stronger local councils delivering better local services that will improve the lives of the people we serve. The decisions announced today will do that, and improve local government for more than 15 million people. We will see 38 councils operating across these areas in place of the current 134. That will result in more than 250 fewer senior posts, significant salary savings and nearly 3,000 fewer councillors, which could save up to £20 million per year on councillor allowances alone across these areas. Councils themselves projected that the decisions could lead to net savings of about £1 billion by the end of 2032-33 when the anticipated benefits are fully realised. Those savings will be reinvested in the front-line services that local people care about the most. Across England, once all decisions are taken, we will have cut the number of councils from 317 to a maximum of 173. That will simplify and strengthen local government serving over 20 million people.

Reorganisation will also support city growth. For example, Plymouth is a nationally significant defence growth location and a housebuilding priority, driven by investment at Devonport. Leicester is a major urban economy facing cross-boundary housing, employment and infrastructure pressures, including unmet housing need. Our decisions today will help those two cities grow, along with others, including Preston, Derby, Nottingham, Exeter, Oxford, Brighton and Hove, and Lincoln. These bigger cities will be crucial in ensuring that our country can build the homes we need.

I am tremendously grateful for all the hard work that councils put in to their proposals, but I appreciate that some Members of this House and some councils will disagree with my decisions. I am sure we can all agree that the hard work of transition to new councils must continue to be a shared endeavour across local and central government. To protect the services that some of the most vulnerable people in our communities rely on, we all need to get that right.

A broad support offer is in place for councils, including support to councils through our sector advisers and through funding to the Local Government Association. We have already announced £63 million in capacity funding to support the reorganisation process. I am pleased to provide further detail today on how this funding will be allocated. Each area will receive an unprecedented £900,000 per new unitary council in capacity funding. On top of that, we are committing up to £150,000 in supplementary funding, as part of a wider package of support for children’s services, adult social care and public health leadership. Taken together, for every reorganisation area, there will be over £1 million in capacity funding for each new unitary council. This is the first time that reorganisation has been supported in this way, and it shows this Government’s commitment to supporting councils to ensure that we get these reforms right.

The programme will now move forward in line with the timetable already set out, with elections to the new unitary councils scheduled for May 2027, ahead of new councils taking up their powers in April 2028. Today marks a significant milestone for the future of local government, with decisions now taken on 19 out of 21 two-tier areas across England. Reorganising local government is not a debate about where to draw lines on a map or about structures and systems; it is about making real improvements to people’s lives and to the communities they are a part of. This reform programme is ambitious, but it is the right thing to do. I commend this Statement to the House”.

My Lords, I thank the Minister for the opportunity to ask questions on this Statement. On these Benches, several of us have run unitary councils. We recognise the potential for improved efficiencies and better delivery for residents. However, that must be done on the basis of genuine communities and geographies, at a scale capable of delivering meaningful efficiencies and with the true consent of residents.

The Government set out clear principles at the beginning of this process: a scale of around half a million people, respect for existing boundaries and local consent. Yet looking at the proposals before us today, it is difficult to conclude that those principles have been applied in practice, with populations ranging from nearly 700,000 down to 170,000, the breaking up of existing district councils, and a lack of local support and consent.

Rather, the common thread that seems to run through the proposals is a focus on the needs of largely Labour-run city councils to the detriment of the rest of those counties. The Government have accepted the proposals of Leicester, Lincoln, Nottingham, Oxford, Plymouth and Exeter, among others, despite unanimous opposition from the remaining councils in those areas. Is this just about rescuing badly run Labour councils and facilitating cities shifting their housebuilding to the neighbouring green fields?

My Lords, there are some deeply worrying elements in the Statement. First, it was issued on the final day before the Commons Recess. A momentous decision of that purport should be the subject of detailed scrutiny but that has been deliberately avoided. Secondly, the announcement has been made by a Minister who then resigned from the Government—it was his final throw of the dice. So this announcement is discredited before the details are even considered.

I trust that the new Minister for Local Government will make it her first task to reconsider the implications of these decisions. It is imperative that Angela Rayner does so, because the decisions that have been announced fail to meet the test of enhancing devolution and democracy or of creating new local authorities that will be financially sustainable. The claim is that creating unitary authorities will put an end to two-tier councils, but, at the same time, the Government intend to create an additional tier of local governance in the shape of mayoral authorities, so two tiers will remain.

The decisions that the Minister made about the boundaries are controversial. Some have described them as gerrymandering, and there seems to be no other explanation in some instances. For example, Devon, which has already been referenced by the noble Lord, Lord Jamieson, has been divided into four authorities—three are relatively small councils in geographical terms, based on Plymouth, Exeter and Torbay, each with a population of around 300,000, and the fourth is the rest of rural Devon, with a scattered rural population with no obvious centre—but Gloucestershire is to have one council serving a population of 670,000 people. Can the Minister explain how this huge range of population sizes is consistent with the parameters that were set by the Government or with creating genuine local democracy?

My Lords, I am grateful to the noble Lord, Lord Jamieson, and the noble Baroness, Lady Pinnock, for their questions and comments on the local government reorganisation Statement.

I will begin with the timeline that has led us to the decisions announced on 16 July, because it is important that we understand how we have arrived at the place we are now. On 5 February 2025, the Government invited councils in 21 two-tier areas, together with neighbouring small unitary authorities, to develop proposals for local government reorganisation. That is not imposing a model from Whitehall; it is asking councils to come forward with their own proposals. Those proposals were received from councils on 26 September and 28 November 2025. The Government subsequently launched statutory consultations on them on 19 November 2025 and 5 February 2026, which closed on 11 January and 26 March 2026 respectively.

Between May and June 2026, the Government undertook further consultation in East Sussex, Brighton & Hove, and West Sussex to inform the consideration of potential modifications to proposals in those areas. Then, on 26 March 2026, the Secretary of State announced the first tranche of decisions, on Essex, Southend-on-Sea and Thurrock; Hampshire, Isle of Wight, Portsmouth and Southampton; and Norfolk and Suffolk.

My Lords, we will now have 20 minutes for the Back Benches. This time is just for Back-Benchers, and we want to hear questions, not statements. We will start with the Conservatives.

My Lords—