Would Local Government Consolidation save £3 billion?
A new report into local government efficiency says replacing smaller councils with larger authorities is the way to unlock huge financial savings, but are there other costs?
Small is beautiful… or big is best? The eternal debate about the optimum size and structure of local government in England was fuelled again last week with publication of research by PriceWaterhouseCoopers on behalf of the County Councils Network. Their headline findings? That the removal of 213 smaller councils and their replacement with 25 larger local authorities could generate savings of £2.9 billion over five years.
It’s not a new concept - witness the rise of unitary authorities - and the detail is somewhat familiar - unpick the legacy two-tier model of County Councils and District Councils, replace them with fewer, bigger bodies that, in theory, can unlock greater efficiencies, coordinated service provision, increased spending power and so on. Already, larger counties like Surrey, North Yorkshire and Leicestershire are developing plans along these lines.
There may be elements of ‘he who pays the piper calls the tune’ here - research can always be made to do its masters’ bidding. But if we unpack the implications, the tide is clearly heading towards super authorities. Cllr David Williams, Chairman of the County Councils Network, which commissioned the research, told the BBC that the financial case for change was “compelling”, citing as an example his own county of Hertfordshire, where there are 11 different local authorities: "That means there are 11 chief executives, 526 councillors, 10 planning teams - so there is an awful lot of complexity, and there is a lot of cost."
They’re well rehearsed arguments, as are those of opponents who say that the bigger authorities do not take into account significant cultural and socioeconomic variances across counties - and that the smaller, more focused authorities are better placed to understand and service the particular needs of residents. It’s simplistic to frame the debate purely in terms of local democracy vs efficiency, as ultimately, the execution of any changes will be what counts. What proportion of those £2.9 billion in savings would be eaten up by consultants fees, costs of organisational restructuring, legal fees, rebranding, community consultations etc?
And what does this tell us about the current state of the local government ecosystem? There’s appetite for change, partly driven by recent statements from Government Ministers about the need to speed up public service provision in the post-Covid world. The Government’s desire to ‘level up’ the country is certainly in harmony with the idea of more powerful autonomous local government.
The Government’s own White Paper on local government reform is due in the autumn, when the direction of travel will be set, and qualification criteria for unitary authorities codified. Those counties already starting the process may simply be getting a head start in a race that the whole country will have to run.