Local Government Reorganisation: the latest state of play

On 16 December 2024, the Government announced its plan to reorganise local government in England by merging all remaining two-tier authorities into unitary councils. On 5 February 2025, the Government issued a statutory invitation to all councils in two-tier areas and neighbouring small councils to develop proposals for unitary government.

The invitations set out guidance that the authorities should have regard to when responding. That guidance contained six criteria, including that proposals should establish a single tier of local government. Proposals also had to be for “sensible economic areas” and for a “sensible geography which will help to increase housing supply and meet local needs”.

This article sets out the key reorganisation stages under the Local Government and Public Involvement in Health Act 2007 (“the Act”), the likely key features of secondary legislation implementing any proposals, and the current state of play nationwide.

The process

Stage 1 of the process involves the formal invitation by the Minister to the respective councils to submit proposals for unitary local government in their area.

Stages 2 and 3 involve the submission by the councils of their formal proposals and statutory consultation.

Section 3(5) of the Act provides:

“In responding to an invitation under section 2, or complying with a direction under that section, an authority must have regard to any guidance from the Secretary of State as to—

(a) what a proposal should seek to achieve;

(b) matters that should be taken into account in formulating a proposal.”

Stage 4 and 5 involve the Ministerial decision selecting the proposal, followed by a Structural Change Order (“SCO”) laid before Parliament as a piece of secondary legislation. Section 7 of the Act confers a broad discretion as to whether or not to decide to implement any proposal. It provides:

“(1) Where the Secretary of State has received a proposal in response to an invitation or direction under section 2, he may—

(a) by order implement the proposal, with or without modification …”.

Stage 6 involves a transition period in which a shadow authority is formed until vesting day. Stage 7 is the vesting day, when the new Council goes operational.

Structural Change Orders and section 24 Directions

The first SCO as part of this latest round of local government reorganisation was issued on 9 March 2026 under section 7 of the Act establishing the East and West Surrey Councils. This gives a good indication of the key features of SCOs that are likely to come forward in relation to other areas. The key features of the SCO include the establishment of joint committees and the establishment of a shadow authority. The SCO also made provision for the establishment of an implementation team, and a year-long shadow period during which a shadow authority was established.

The 2007 Act also provides for section 24 directions preventing local authorities from entering into significant transactions or making significant disposal of assets during the reorganisation process (in effect, preventing major financial decisions being taken which could prejudice future unitary authorities). These sorts of directions are likely to accompany SCOs to ensure the hands of the new unitary authorities are not tied by decisions of their predecessor authorities.

The latest state of play

This figure shows the current situation in England as of 24 June 2026 (with the red marking where a proposal decision has been made by the Minister). East and West Surrey was the first area where an SCO has been issued, reflecting the fact that it was part of an accelerated track for reorganisation.

Current legal challenges

Successful judicial reviews in relation to previous local government reorganisation are rare (reflecting the broad discretion of the Secretary of State to approve any proposals submitted by any of the councils to whom an invitation has been issued). However, in Devon County Council, Norfolk County Council v Secretary of State for Communities and Local Government v Exeter City Council, Norwich City Council [2010] EWHC 1456 (Admin), section 7 orders implementing structural changes were quashed by the court because the Secretary of State, when reaching his decision, applied a criterion that had never been revealed to respondents at any point in the process leading up to and including the consultation.

There are media reports that Hampshire County Council is proceeding with a judicial review of the Government’s decision to reorganise councils across the Hampshire and Solent area, in addition to Essex County Council and Portsmouth City Council. It is unclear what the grounds of challenge are that are being pursued, or the timing of the determination of any such challenges. However, it is likely that any legal challenges will focus on the application by the Minister of the 6 criteria referred to in the invitation guidance, and whether or not the Minister followed the Gunning principles for lawful consultations (which include that the decision-maker must conscientiously take into account the views expressed by consultees).