Angela Rayner MP, Secretary of State on Housing, has announced the Government will be withdrawing Local Government Reorganisation (LGR) decisions on Essex, Norfolk, Suffolk and Hampshire, while reviewing the decisions for other 14 areas where maps for proposed new unitary authorities were published earlier this year. During this time, the LGR progress for the 14 areas will be paused.
Surrey remains unaffected, which means its reorganisation plans will progress as planned, and East Surrey and West Surrey will be formally established in April 2027.
Rayner said in her statement that this decision has been made to ensure LGR is done with a proper legal process and can satisfy the government’s ambition to bring power closer to communities. Several councils in the affected areas had launched judicial reviews of the LGR process.
While some analysts have claimed that Rayner’s announcement is the end of LGR, this conclusion is in my view somewhat premature. With a new Prime Minister who is so closely associated with the devolution agenda and the return of Rayner as Secretary of State, it is not surprising that the Government has sought to reconsider the immense challenge of LGR. Given the size and scale of the proposed reorganisation, it was always going to be hugely challenging to undertake such work at pace especially considering the hollowing out of local government resources in recent years.
However, rather than being the death of LGR, I would seek this as an attempt by Andy Burnham and Angela Rayner to review and reboot the process. While the official explanation for the postponement of LGR cited legal factors, with the Government no doubt concerned that the previous successful judicial review of the decision to cancel some local elections could be repeated. It should be noted that there are also some deeply political factors which may have led to the government postponing LGR.
Essex would have changed significantly but there still would have been a large number of Authorities
The architect of the initial drive to reorganise local government after the 2024 General Election was Jim McMahon who has now returned as an MHCLG Minister. McMahon knows local government inside and out having been a council leader himself and a senior vice-chair of the Local Government Association. McMahon’s initial guidance for new unitary authorities was that they should have minimum populations of 500,000. Following his dismissal by Sir Keir Starmer and departure from government, a raft of new LGR proposals were agreed that were well below this threshold. McMahon as a backbencher was vocally opposed to these proposals. Now back in post at MHCLG, he has been able to reset the LGR process back in the direction that he originally envisioned. This means that in many if not most cases, new solutions will be sought that may deliver larger unitary councils, in some cases covering whole county areas, rather than the smaller ones that were announced by former Secretary of State Steve Reed earlier in the summer.
It can now be expected that Ministers and senior civil servants will slow the pace of decision-making and there is a danger for the government that these decisions may now not be implemented before the end of this Parliament, increasing the chances that they could be reversed in the event that Labour does not win the next General Election. There are currently no concrete details on when the new decisions will be published.
Sir Keir Starmer’s Government passed the English Devolution and Community Empowerment Act earlier this year, giving ministers powers to direct councils to bring forward proposals for local government reorganisation. This means that Angela Rayner and Andy Burnham could revisit LGR in future without needing new primary legislation. Any future implementation would require a statutory instrument to be approved by both Houses of Parliament. Although there is some scepticism among MPs much of the opposition has focused on individual boundaries, costs and the process rather than the principle of LGR itself which has broad support across the Parliamentary Labour Party. It is clear that a large number of Conservative, Liberal Democrat and Reform UK MPs have serious misgivings about Local Government Reorganisation in its present form.
In the areas where the LGR decisions are withdrawn, the local elections which were scheduled to take place for May 2027 for the new unitary authorities will be cancelled. Instead elections will take place for the existing district councils on current boundaries.
One of the main reasons for LGR was in order to encourage the approval of new residential development by facilitating a less parochial approach to planning decision-making. We have already seen some new unitary authorities following a Strategic Planning Committee model to determine major planning applications which typically involves councillors representing wards over a larger geographical area taking decisions over applications. This approach was welcomed by many in the built environment sector and Rayner’s announcement of the postponement will be seen as a setback for some developers and investors. However, should LGR be resurrected with larger geographical areas then this could result in more favourable planning environment in the longer term albeit that there will now be further delays and uncertainty.
In short, LGR is not dead and is likely to be revived in a form more conducive to the ambitious devolution agenda supported by Andy Burnham and Angela Rayner. This week’s announcement was undoubtedly a short-term setback for those wanting to see more unitary councils created but in the longer term it may actually be beneficial for those wanting to see more homes built.
Duncan Flynn is a Senior Director (Planning) at Cratus Group, with over ten years’ experience advising clients across the UK’s built environment sector, and a background in law, politics, and public affairs.
