Local Government Reorganisation

Baroness Taylor of Stevenage Excerpts

Tuesday 21st July 2026 Lords Chamber

[Baroness Pinnock (LD)]

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?

The argument made in the Minister’s Statement is that there will be 3,000 fewer councillors. From my perspective, it is shameful to be proud of reducing the number of elected representatives. Democracy has to enable electors to feel that they have access to local decision-makers and can influence local decisions. Reducing the number of councillors means increasing the size of wards and making councillors more remote from the people they represent, so, on the test of enhancing democracy and enhancing devolution, these decisions have failed.

Then there is the claim that there will be cost savings by having fewer councillors and fewer council officers. That is a claim that government always makes, but it is not supported by facts. For example, in Devon, the previously single social care model for the whole country will be required to divide into four units, and financial benefits of the model will drop sharply. Very large councils of over 400,000 population see costs per head rise and the financial benefits lost, yet the Government have created several councils way above the 400,000-population size.

The Minister may be able to explain the financial argument with details omitted from the Statement, and I look forward to that if she has those details. In the Statement, the Government have admitted that they have failed in the task of making decisions on Cambridgeshire & Peterborough and West Sussex. When will those decisions be made? Meanwhile, the timetable for electing councillors for the new unitaries is set for May next year, while in some cases ward boundaries will have to be reviewed because of the way the boundaries for the new unitaries have been drawn.

Democratic representation is vital for communities. In England, each councillor will on average represent 3,000 electors. In France, that number is nearer 200 and in Germany it is 400. This Statement represents a retrograde step and a lost opportunity to revitalise local democracy.

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)]

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.

I will now set out the decisions announced by the Secretary of State on 16 July. These were subject to parliamentary approval. They were announced in Parliament on 16 July. There was another debate on the Monday of that week on the same subject. A Written Ministerial Statement was laid, and of course we are debating the decisions now in this House.

The Government will implement, subject to parliamentary approval, proposals for new unitary councils including: two unitary authorities in Derbyshire and Derby, 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 & Hove, the two- unitary proposal, including 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 City of Lincoln Council, including boundary changes and 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, Cannock Chase and Stoke-on-Trent; the two-unitary proposal in Warwickshire; and the two-unitary proposal in Worcestershire.

In Cambridgeshire & Peterborough and West Sussex, the Secretary of State has concluded that further time is required before decisions are reached. It is very important that we take the time to make the right decisions for those areas. To respond to the question from the noble Baroness, Lady Pinnock, about when those will be made, it will be as soon as possible and no later than October. They will be worked on and decided as soon as possible.

I recognise that not all noble Lords, or all councils, will agree with every decision we have made. These are significant changes and they matter deeply to places. Each proposal has been considered carefully against the published criteria, consultation responses and all other relevant information, including consultation with other government departments. The Government’s responsibility is to take decisions that are sustainable, coherent and in the long-term interests of residents.

The reason for reform is clear. In too many places, two-tier local government is confusing for residents. It divides responsibility, slows decisions, duplicates costs and blurs accountability. Boundaries drawn for a different era too often no longer reflect how people live, work, travel and access services, or how they see their own area. That does not serve residents well, nor does it equip leaders for the future. That is why local government reorganisation is necessary: to create stronger councils with the scale and capacity to deliver better services, support economic growth and provide clearer accountability.

Across these areas, 134 councils will be replaced by 38 new unitary authorities. Across England, once all decisions are taken, we will have cut the number of councils from 317 to a maximum of 173. This will simplify and strengthen local government serving over 20 million people. To answer the question from the noble Lord, Lord Jamieson, about savings, the councils themselves have identified significant potential savings of around £1 billion by the end of 2032. These savings can be reinvested in the front-line services that people rely on.

Of course, local government reorganisation is not without its challenges. Transition has to be handled carefully, particularly where vulnerable residents depend on services such as children’s services, adult care and public health. That is why we are providing over £1 million in funding for every new unitary council, including £900,000 in capacity funding and up to £150,000 of additional funding to support children’s services, adult social care and public health leadership. Pace also matters. Council staff and residents need certainty, so moving forward now allows areas to prepare for elections in May 2027 and for the new councils to take on their responsibilities in 2028.

To respond to some of the other questions—I see that I do not have much time, but I will be as quick as I can—the noble Lord, Lord Jamieson, and the noble Baroness, Lady Pinnock, referred to gerrymandering. That is absolutely not the case. I do not know if Members listened to the debate in the other House, but if this was gerrymandering, it did not work, according to some of our Labour Members at that end of the building. The decisions were based absolutely on the merits of the proposals against the six published criteria, consultation responses and other relevant information, and the proposals selected have backing from a range of political parties, not just Labour. Previous decisions did not set a precedent, and I stress that every decision we took was on the basis of the information. All local areas are different, as we often say in this House, and we had to take decisions based on the local circumstances, so they were taken individually and judged on their own merits.

The department ran an independent consultation to assess the proposals against the criteria set out, and the responses were an important factor in the decision-making process. The process is locally led, with councils having been invited to develop proposals for their own areas.

On the size of the local authorities, the 500,000 population figure has always been a guiding principle, not a fixed threshold. Ministers set this out publicly on at least five occasions. Our messaging has been consistent: there may need to be exceptions to ensure that new structures make sense for an area, including to support devolution, and decisions will be made on a case-by-case basis.

I make no apologies for the growth focus in some of these decisions. We need to harness the growth that we know can come from every part of our country. We have made our decisions according to the criteria, and some of those are focused on growth. We need to continue with that so that we can get the potential that this country has out to every postcode in the land.

[Lord in Waiting/Government Whip (Lord Wilson of Sedgefield) (Lab)]

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.

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[Baroness Eaton (Con)]

My Lords, I declare my interest as a vice-president of the LGA. It is very encouraging to see how keen the Liberal Democrats are to scrutinise the Government. Given the inconsistent approach to last week’s reorganisation announcements, can the Minister please confirm whether officials advised Ministers that an expansion of the exceptional financial support package would be required to support some of the newly formed councils, which will come close to Section 114 territory upon formation?

[Baroness Taylor of Stevenage (Lab)]

When we took these decisions, we were very aware that some of the councils involved were already receiving exceptional financial support. We continue to work with those councils through the EFS process in the usual way, but LGR will save money over time and make the sector more sustainable in the long term. Where there are issues around funding and finance, the Government are already tackling this with our fair funding formula, and we have supported some authorities with exceptional financial support. We will continue to keep that under review where it is needed, but it will exist whether the confusing two-tier system remains or we transition to unitary authorities.

[Lord Grocott (Lab)]

Can my noble friend provide some details and facts? She may not be able to answer now, but I would like her to do so in writing. The Statement claims that there will be very substantial savings from this operation—savings of £1 billion are mentioned at one point—but it is much more opaque on the costs of the reorganisation. Many of us with experience of these things know well enough that this can be a very expensive business. Can my noble friend therefore provide clarity on two specific questions? First, how much has it cost so far? We all know that local authorities almost come to a standstill when they are contemplating their abolition, and that central government has also been spending a lot of money. Secondly, from the various references in the Statement, which I have tried to make sense of—£1 million for new unitary authorities, capacity building funds, et cetera —can my noble friend tell us the sum total of expenditure that the Government and local authorities are expected to spend to achieve this reorganisation?

[Baroness Taylor of Stevenage (Lab)]

The estimate of the savings came from the work that the local authorities did themselves. I accept that there will be a great deal of work to be done through the process as we transition to these unitary authorities. But, quite frankly, I have worked in a two-tier authority in all my time in local government, and I think that the effort of going through the transition phase is well worth the endgame here: making sure that we have a system of unitary authorities right across the country; I know that the noble Baroness, Lady Scott, has done this exercise herself in her own council. They will be the building blocks for the devolution programme, as we continue to roll out devolution across the country.

The figures being provided for support for this process are: £1 million in funding for every new unitary council, £900,000 in capacity funding, and up to £150,000 of additional funding to support children’s services, adult social care and public health leadership. This is an investment to make sure that we have a consistent system of local government across the country and that those savings that councils have told us they can generate will occur.

[Lord Shipley (LD)]

My Lords, the Prime Minister said yesterday:

“We will take power out of here and carry it into every postcode in the land so that they can do more”.


Indeed, the Minister said the very same thing a moment ago. Yet this Statement centralises power into unitary councils; it does not devolve power to town and parish councils. Why have they been missed out of this Statement? They clearly should be a key part of the Government’s planned devolution to postcodes. I hope the Minister will be able to reassure us.

[Baroness Taylor of Stevenage (Lab)]

My Lords, the noble Lord was part of the discussions on the English Devolution and Community Empowerment Bill, which set out clearly the role of town and parish councils as we develop neighbourhood governance processes. I went to the National Association of Local Councils—NALC—conference recently and spoke to them, and they will be fundamentally involved and engaged in that neighbourhood governance process. The noble Lord is quite right that we need to make sure that, where funding is devolved, it does not stop in the mayoral authority but is devolved to our communities. We are keen to see that happen. The dialogue with town and parish councils is ongoing, and I look forward to those discussions with them as we take this process forward.

[Lord Porter of Spalding (Con)]

My Lords, it is obvious that you cannot make an omelette without breaking eggs, but this seems to have left rather a lot of shell in there, if we listen to the complaints from around the country. Can the Minister confirm that, if the new Prime Minister’s focus for the department will be mayoral devolution to mayoral combined authorities, the department has the bandwidth in this Parliament to deliver the set of unitaries that has been set out? It is clear from some of the conversations we are having that there is not enough bandwidth in the department to deal with all of this now. If the Government add to that the mayoral stuff, they will run that set of civil servants off their feet. I do not think the Government will have the capacity to deliver it.

[Baroness Taylor of Stevenage (Lab)]

I am grateful to the noble Lord for mentioning our new Prime Minister, because he is quite keen on devolution—that might have something to do with his background in the last few years. I am sure he will want to see those building blocks of strong unitary authorities in place so that we can get on with the devolution process without further delay. Local government reorganisation is an existing policy that is already well under way, and the £63 million of funding that places will receive to support them with transition costs had already been agreed. We have announced this now, and I expect that my department will have active discussions—through our new Secretary of State, Angela Rayner, whom I welcome to her role—about how we do this. We have already asked those local authorities to consider the footprint they want to see for their foundation strategic authorities. The noble Lord asked about bandwidth in the department. The department has been outstanding so far in managing this process, providing us with the information that we need to take effective decisions against the criteria we set.

[Lord Bach (Lab)]

My Lords, I warmly congratulate the Minister and the Government on their decision to extend the boundaries of the city of Leicester. Does she agree with me that its current boundaries are absurd and should have been extended years ago, as half of what is really the city is presently administered by other authorities? Does she agree that the city of Leicester desperately needs more land for business and housing, and it needs much greater local funding to be able to satisfy its inhabitants?

Finally, does the Minister agree that the gerrymandering accusation is laughable? If anything, this decision allows other parties that have not had a look-in for many years a way into Leicester’s governance. It is something they should stop complaining about.

[Baroness Taylor of Stevenage (Lab)]

I am grateful to my noble friend, as ever, particularly for his championing of Leicestershire, which he does admirably. The Government were always clear that boundary changes could be considered where there is a strong justification. Where proposals set out a credible case, we have considered them on their merits. This reflects the aim to ensure that new councils are able to deliver effectively for their communities over the long term, including supporting future growth. The point that my noble friend makes is really important in this. Some of our cities and towns are constrained by boundaries which came from a different era. If we are to maximise the growth in those areas, we needed to accept that there may have to be boundary changes. They are not a deviation from our stated criteria; they were absolutely part of our considerations to make sure that we met the challenge of growth for our towns and cities, but also that we enabled our local authorities to come forward with proposals that made sense for their local area.

[Lord Swire (Con)]

My Lords, the Labour Party has a record of trying to destroy what it regards as Tory support, particularly in the shires. We saw that with its cack-handed approach to regional assemblies, which got nowhere. I do not know how well the Minister knows Devon, my county, but she has delivered on the agenda that has been pushed for many years by Labour-dominated Exeter City Council, which has had its eye on the rich plains of my old constituency of East Devon, which, under these proposals, it will now have. I believe that these proposals for Devon to have four different local unitary authorities do not serve the people of Devon. The Government have made a great announcement over the past 24 hours that all policies will be subject to rural-proofing. I simply ask the Minister this: what rural-proofing has been done on these proposals for the fourth part of these Devon proposals, which will leave a great swathe of rural Devon underrepresented, with the wealth concentrated in the three other unitary authorities?

[Baroness Taylor of Stevenage (Lab)]

I am going to sound a bit like a stuck record, but the proposals came forward from the local authorities themselves.

[Noble Lords]

Oh!

[Baroness Taylor of Stevenage (Lab)]

Well, we looked at all the proposals that were submitted and we assessed them. Noble Lords opposite can laugh if they want. I have been through this whole exercise of assessing every proposal that came forward against the criteria set for them. We did that fairly against the criteria that were set. We looked at every proposal to see how they best fitted the criteria and these are the decisions we made. I absolutely accept that not everyone is going to agree with those decisions, but we needed to make sure that we took account of the need to grow some of our towns and cities, to have sustainable and resilient public services—that was a really important consideration in this, on which we got advice from other government departments—and to set the boundaries where they would make a cohesive community. Those were the primary considerations, as we set out in the original invitation letter, and all the proposals that we received were considered against them.

[Lord John of Southwark (Lab)]

My Lords, as a councillor, I have always represented about 3,000 electors, but they and I always had the certainty and clarity of where strategic responsibilities and responsibility for service delivery lay within the London borough and the GLA. I do not believe that that has historically been the case for residents, or even councillors, in districts and counties. Will my noble friend say more about how she hopes to achieve that clarity by the changes that are coming forward?

[Baroness Taylor of Stevenage (Lab)]

I am grateful to my noble friend for raising this very important issue. Those of us who have operated in two-tier areas would often look at London boroughs and other unitaries—the unitary of the noble Lord, Lord Jamieson, was very close to my local authority—to see that clarity is much easier for the public to understand in a unitary authority.

My noble friend is right to point out that these problems come with duplication, and there are benefits in eliminating that. For example, Buckinghamshire Council estimates that it costs around £30,000 a year just to tell people that they have got the wrong phone number. Those sums can be taken out to make that funding available to invest in front-line services.

The Secretary of State has announced an outcomes framework so that residents can see for themselves how well their council performs. But they should be judged against the same set of services and I very much look forward to the lack of confusion and to not having to have discussions, as I did many times in my own authority, about what are street trees, what are highway trees and who should be looking after which trees.

[Lord Lansley (Con)]

My Lords, I draw attention to my registered interest as chair of the Cambridgeshire Development Forum. The Minister said that no decision had been made on unitaries in Cambridgeshire and Peterborough. I looked at the letter that was sent to leaders of local authorities and it did not explain why a decision had not been reached. It did not explain what further evidence needed to be gathered in order to make a decision before October, as the Minister said. Of course, tomorrow this House is to debate the establishment of a development corporation in Greater Cambridge on a territory that is aligned with the expectation of where one of the unitary authorities would be. Now we will not know what the geography of unitaries in Cambridgeshire will be at the point at which we make that decision. Can the Minister tell me why a decision could not be made in Cambridgeshire?

[Baroness Taylor of Stevenage (Lab)]

I am very grateful that we will debate that issue tomorrow, because at one point this afternoon I thought we might not. I am very pleased that we will debate the Cambridgeshire development corporation tomorrow.

In relation to Cambridgeshire and Peterborough, local government reorganisation is a fundamental change that will affect residents for generations to come. Given the significance of Cambridgeshire and Peterborough for national economic growth, which I know the noble Lord will understand from very close quarters, it is very important that we take the time required to get this right. The Secretary of State has indicated that we will aim to reach a decision on which option to implement by October at the latest. We are still committed to the existing timetable, but we wanted to take account of some of the growth issues that are still emerging as we go through the next phase of this decision-making.

[Baroness Bennett of Manor Castle (GP)]

My Lords, I declare my position as vice-president of the Local Government Association and of the NALC. The Green Party shares many of the concerns expressed from the Front Benches, and indeed the Back Benches, all around your Lordships’ House on the question of process and the imposition from Westminster of arrangements on local areas.

My question follows on from that of the noble Lord, Lord Shipley, about parish and town councils. The Minister said in responding that there would be support, because these are obviously going to be the remaining local representatives who people can go to with very local issues. The Minister said that this would be strengthened. But, of course, many areas of the country do not have parish and town councils. Very often, they are newer-developed and generally poorer areas. Are the Government seriously looking at expanding the coverage of parish and town councils, so that people will have a local representative that they can go to, rather than a far-distant unitary councillor?

[Baroness Taylor of Stevenage (Lab)]

First of all, I do not think that they will be far-distant unitary councillors. In my experience, councillors have a great connection with their local area and they will continue to do so. I will answer the noble Baroness’s question in two ways. There is still a process where people can apply to have a parish or town council for their area. That process remains in place. If people wish to set up a town or parish council, they can do so. The other thing that is coming through very shortly from the English Devolution and Community Empowerment Act is the neighbourhood governance process. The details of that will be set before the House very shortly, so we can debate that as well.

[Lord Faulkner of Worcester (Lab)]

My Lords, can my noble friend confirm that, possibly unlike in some other areas, the proposals for Worcestershire for two unitary authorities geographically divided by north and south have come from the councils themselves? The seven district councils have worked together to produce the two-authority model, which has survived changes in political leadership and been approved by councils of very different political complexions. I hope there will be the possibility at some stage to explain why that is the right decision. The Secretary of State’s letter says the proposal

“will allow each council to shape housing and economic strategies around its own area, including local issues such as land supply, affordability, regeneration, workforce needs and business strengths”.

Those are the reasons why local people and local councils in Worcestershire are supporting it, and I am delighted that that is what the Government have decided.

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[Baroness Taylor of Stevenage (Lab)]

I thank my noble friend for his welcome of that decision. He is quite right, of course, that when these proposals were put forward there were areas on which there were different opinions within political parties about how things should be done, as well as differences between political parties. That is why it was very important that we judged absolutely against the criteria that we had set. In response to his question about the rationale for the decisions, all the areas that have had decisions will receive a decision letter from the Government setting out the rationale behind the decision, which I hope will help local areas understand how the process has worked. As I said, and as I will keep stressing, the proposals all came forward from local areas; we have not designed any of these proposals in Westminster.

[Lord McLoughlin (Con)]

My Lords, being a bit sceptical, like the noble Lord, Lord Grocott, as to the alleged savings that will be made as a result of this, can the Minister tell us what mechanisms are in operation to stop councils which will be altered in their status embarking on large contracts between now and the new authority dates?

[Baroness Taylor of Stevenage (Lab)]

That is a very important issue indeed, which we picked up on early in the process. The Secretary of State has written to all tiers of local government to ask them, if they are undertaking big contracts—which is sometimes necessary, because if your contract is running out, you cannot wait until the new authority is in place—to work in partnership across the local authorities involved to make sure that everybody understands what is being committed to. We have asked for the same with capital disposals, so that all local authorities make sure they are working in partnership and everybody understands what is happening, both with capital and with contracts.