Plans for local government overhaul on hold after legal advice

Angela Rayner to announce review into local government shake-up as decisions on four areas withdrawn and 16 paused

Plans for a large reorganisation of local government have been put on hold after the government received new legal advice that suggested they might not comply with the law.

The Ministry of Housing, Communities and Local Government (MHCLG) said the review was to ensure the process was robust and aligned with the new government’s aim to “rewire the state”, and followed “updated and privileged legal advice”.

The reorganisation plans, announced in December 2024, proposed the abolition of the current two-tier system of districts and counties in favour of a smaller number of unitary authorities – or “mega-councils” – covering large areas.

At least eight councils had launched legal challenges or were considering doing so owing to opposition to the government’s choice of boundaries for new councils.

Reform UK-led Kent county council is to consider a judicial review at a meeting on Tuesday after it did not receive a response from the government to a letter setting out concerns.

Plans for reorganisation in Essex, Hampshire, Norfolk and Suffolk have been withdrawn in the light of new legal advice.

Councils in Essex launched legal action in June after it emerged that its own preferred option to create three unitary councils in the county was backed by senior government officials but rejected by the then communities secretary, Steve Reed.

There has been little appetite for the proposals within local government, with many councils regarding the changes as expensive and time-consuming, and offering little in the way of cost savings that would ease local authorities’ dire financial crisis.

Decisions on 14 further areas will be reviewed and paused alongside the cases of Cambridgeshire-Peterborough and West Sussex, which are yet to have a decision confirmed.

The government will also confirm that local elections in May 2027 will go ahead on existing council boundaries, saying it remains committed to effective and sustainable local government and simplifying these structures.

The communities secretary, Angela Rayner , is expected to tell parliament on Monday: “As we are now more determined than ever to devolve power closer to the people we represent, it’s only right that as a new secretary of state I make sure that everything we do is working towards that plan to change Britain, without delay.

“The prime minister told the house last week he was ‘prepared to look at local government reorganisation’ and he asked me as his communities secretary to ‘do that’.

“In that context, in light of legal advice, I want to satisfy myself firstly that the right process is in place, that it is robust, and of course complies with the law.

“And, secondly, I want to fully test whether our proposals for local government reorganisation meet the priorities of a new administration and a new prime minister, and any additional considerations.

“I do not take this lightly. I recognise the huge amount of work that has already gone into progressing reorganisation in each of these areas and I am very grateful for it.”

MHCLG said reorganisation in Surrey would not be affected by the review and the two new unitary authorities, East and West Surrey, would go live in April 2027.

Cllr Sean Matthews, chair-elect of the County Councils Network, said: “Many of our members will be relieved that the decisions they viewed as damaging to local services and financially unsustainable have been withdrawn or are being reviewed. For our councils that do want to proceed with reorganisation in their area, we will support them in their next steps and we will be seeking further clarity from government in the coming days.

“With the government clearly listening to our concerns, we now stand ready to work with ministers. Where reorganisation is desired, this review must ensure a robust, legally compliant process in line with the original criteria. This should include establishing realistic implementation timescales and ensuring that any further decisions only create sustainable new unitary councils capable of improving local services.”

Jonathan Carr-West, chief executive of the Local Government Information Unit (LGIU), said: “What began as the most ambitious change to local government in a generation now looks in danger of becoming a colossal white elephant – a huge drain on time, resources and goodwill. Those councils undergoing local government reorganisation have been trying to implement a massively complex project, under intense pressure and to very challenging timescales. Our overriding concern is that local government leaders, staff and councillors have strained every sinew to meet the deadlines set by MHCLG. Today’s announcement – whatever the reasons behind it – rides roughshod over 1,000s of hours of work.

“If the prime minister is serious about his ambitions to rewire the state, then lessons must be learned from this debacle and learned fast.”