Local Government Reorganisation: South-east

David Simmonds Excerpts

Tuesday 10th March 2026 Westminster Hall

[David Simmonds (Ruislip, Northwood and Pinner) (Con)]

It is a pleasure to serve under your chairmanship, Mr Vickers. I draw the House’s attention to my entry in the Register of Members’ Financial Interests on my roles as an unpaid parliamentary vice-president of both the Local Government Association and London Councils.

I congratulate to the hon. Member for Surrey Heath (Dr Pinkerton) on securing the debate. He, the hon. Member for Crawley (Peter Lamb) and my right hon. Friend the Member for East Hampshire (Damian Hinds) set the tone of a debate that has engaged, with a high degree of seriousness, not only with the issues that stem from the specifics of what is happening in Surrey but with what they say about the wider local government reorganisation debate.

It was interesting as a parliamentarian to be present, a short time ago, at a Delegated Legislation Committee in which Committee members agreed the abolition of the historic county of Surrey and its replacement with two unitary authorities. That was the conclusion of a long period of debate in which, as the hon. Member for Crawley outlined, the leaders of county councils in particular argued strongly that local government reorganisation on the footprint of the existing county structure would be a way to save money. Many district councils argued strongly against that idea, and it was called into question by many experienced unitary leaders.

We all recognise that there is a need to look again at our local government settlement. This country is already very under-represented in democratic terms at the local level, with the fewest elected politicians per capita of any developed democracy. It is also intensely centralised by comparison with most other countries, with decisions that would as a matter of routine be local decisions in most other democracies taken by Parliament or central Government.

I have a huge amount of sympathy for the Minister, because while she is from the Ministry of Housing, Communities and Local Government, council services touch on the work of the Department of Health and Social Care, the Department for Education, the Department for Transport, the Treasury, the Ministry of Defence and the Home Office. The observations that other Members have made about the impact of special educational needs and disabilities demonstrate that complexity, where an issue that sits outside the Ministry of Housing, Communities and Local Government is one of the single biggest factors in the viability of local authorities.

The last time we faced each other across the Dispatch Box, I asked the Minister, with particular respect to Surrey, whether there was an update on negotiations. Surrey had set out very clearly that its deficit on SEND spending sits at around £350 million, and the Government had been clear—in fairness, it was Department for Education Ministers—that they would pay off 90% of that deficit. The offer to Surrey was £100 million, which was significantly less than the 90% that we were promised at the Dispatch Box. This is not simply a matter of what happens in a single Government Ministry; it brings together services, activities and decisions across Government.

Reflecting on the long history of local government reorganisation, it probably predates the existence of our country as a unitary state. Certainly the role of some ancient Saxon kingdoms is quite akin to the behaviour of some local government leaders today. The particular challenges that come from the difficult relationship between central and local government are manifest here today.

With regard to recent developments, I spent 12 years in local government under the previous Labour Government and a further 12 years there under the Conservative Government who left office in 2024, and many of the decisions that were made then by central Government—statutory requirements placed on local authorities such as SEND arrangements, social care, the fair access criteria that were introduced, housing—were never fully funded. Since the early 2000s, there has been steady growth in the share of local government spending that is consumed by social care and housing. We have seen an erosion of the ability of our elected local leaders to deploy locally raised resources against local priorities, to the extent that social care now consumes around 70% to 80% of the budget of a typical social care authority. That is not sustainable.

Other Members have spoken passionately and with a degree of criticism about the impact that investment decisions at the council level have had. We all recognise that councils led by all of the parties represented here have made both good and bad decisions when it comes to investment, but we should be wary of criticising local leaders for having made decisions in good faith that did not end well. At a time when the public works loan board interest rate was 0.25%, the decision—even by a council—to take a loan and put it in the bank would have generated additional finance that could have supported local government services. Those decisions were not always innately wrong, but the impact of covid on local authorities’ investments in commercial property was absolutely devastating. Spelthorne, which has been mentioned today, is one example of that: what would have looked like an extremely sound commercial investment turned into a very bad one because of the impact of covid.

         We find ourselves today in a situation where Surrey is unusual. It is the only authority announced for the devolution priority programme that has got to the point of creating new successor unitary authorities. At the outset of this process, the Government were very clear that they were going to cancel the elections in all the devolution priority programme councils, which we voted against at the Delegated Legislation Committee that considered that matter. They did so on the basis that elections for the new unitaries and mayors would take place across the country. There were supposed to be elections this May for new mayors in Suffolk, Norfolk, Essex, Hampshire and many other places. Political parties and local leaders had been working on that basis, only to find after a 24-hour U-turn last December that the elections that were promised to go ahead were suddenly being cancelled.

All this delay and dithering is imposing costs. I met yesterday with a finance company that told me that the procurement of new finance systems across the local authority sector has simply ground to a halt in the absence of any clarity from Government about what is happening. The commissioning of new services in social care to address homelessness has collapsed, which I know concerns the Minister, as has the delivery of housing—both the pipeline of new applications and the completions of new properties. Two thirds of London boroughs report no new net additional homes. That is an absolute indictment of the state in which many of our councils find themselves because of the delay imposed by this process.

As the hon. Member for Crawley outlined, both the Government and the wider argument for this reorganisation rely on a now rather old report that was prepared by PricewaterhouseCoopers at the instigation of the County Councils Network to support the case for county-based reorganisation. It is clear from the evidence he presented that the hon. Member, who left us in no doubt about what he thinks of this process, knows of what he speaks. The start of the process was simple. Half a million people was the minimum footprint in order to secure savings. That was the level that the Treasury expected to see delivered. However, that is significantly larger than the existing footprint of most unitary authorities. As my right hon. Friend the Member for East Hampshire described, it risked losing the sense of place and identity. Ministers quite wisely backed off. They looked at the bids from the local authority areas that were instructed to submit them and settled on a smaller footprint.

That fundamentally undermines the case that this will result in significant revenue savings to the Government in the medium to long term, for the reasons outlined by the hon. Member for Crawley. A concern that the Opposition have raised a number of times on the Floor of the House is that the Government have no independent modelling or independent financial analysis to back up their direction of travel on these reorganisation decisions.

As all Members who spoke passionately about their enthusiasm for getting local Government right recognised, when we compare ourselves, sometimes unfavourably, to other European countries and ask why they seem to be able to build railways and public transport infrastructure faster than the United Kingdom, the answer is largely that those decisions are made at local and regional level; they are not made by central Government. Delivery of rail networks or citywide transport, for example, which I know is of concern to a huge number of Members where lots of good projects are on the stocks, is much faster and cheaper in many other countries. We need to look at what we can learn from their experience.

We need to reflect on the role of the Treasury. I have heard former Chancellors say that when the demand for additional day-to-day spending becomes unbearable, the temptation is to simply slow down the exit of capital from the door on major projects. One of the benefits of localisation is that it removes that temptation from Chancellors and ensures that things that are committed to, become deliverable at a local level.

There are many urgent pressures. One of the key concerns I hear from councils all the time is that the Government do not have a huge amount of time to think, not just in the sense of the parliamentary timetable but when we look across our country. Unemployment has been relentlessly rising every single month since the Government took office, homelessness has surged up 27% in London alone since the Government took office, debt is rising rapidly, planning decisions are grinding to a halt and housing delivery is grinding to a halt. We need to give local communities hope that there is a prospect of solving some of those matters. I share a concern with the hon. Member for Crawley, which affects us very directly. The decisions that the Government have made in the Home Office, speeding up decision making on asylum seekers, pushing those people out the door and up the road to the town hall which then has responsibility for housing them, is putting acute pressure on my local authority, his local authority and many others across the country who are doing their best in difficult circumstances.

It is very clear that a whole range of issues are brought to our attention by what is happening in Surrey. I am grateful to all hon. Members who have set out their particular concerns. I hope that, as a result of the observations made in the debate, we may see the Government come back with a revised set of policies that reflect a clear sense of place and the opportunity for all our constituents to know that they will have elected representatives who can make the decisions that they want to see made at a local level.

[Peter Lamb]

On a point of order, Mr Vickers. Regarding my earlier breach, I just want to apologise to you and to the Chamber for referring to my right hon. Friends the Members for Ashton-under-Lyne (Angela Rayner) and for Leeds West and Pudsey (Rachel Reeves) by their names rather than by their constituencies, and without forewarning. I was unaware of the process. I will make sure it does not happen again.