Ministers did not do value evaluation of English council mergers

The UK authorities didn’t do its personal evaluation of the price of the largest reorganisation of councils in England for many years, the BBC has realized.

Deputy Prime Minister Angela Rayner mentioned “a significant amount of money” could possibly be saved by merging councils in 21 areas into single authorities.

Rayner’s division, the ministry of native authorities, primarily based its value estimates on a 2020 report commissioned by the County Council Network (CCN) that mentioned £2.9bn could possibly be saved over 5 years.

But the CCN has since revised its evaluation and now says the reorganisation may make no financial savings and truly value cash in some eventualities.

Tim Oliver, chairman of the CCN, mentioned native authorities reorganisation “could unlock billions in efficiency savings to be reinvested in frontline services”, if it was delivered on the proper scale.

Oliver mentioned the CCN supported the federal government’s reforms however added: “We are concerned over the potential costs of reorganisation where proposals seek to replace the two-tier system with multiple small unitary councils.”

A two-tier system means tasks are break up between a county council and district councils.

Councils concerned within the reorganisation have been submitting plans to create new native authorities of their areas.

Some have proposed establishing a number of smaller unitary authorities of their areas.

In Essex, for instance, the county council has proposed three new unitary authorities within the area.

The authorities will determine which proposals to take ahead and intends to tell most councils subsequent 12 months.

A authorities spokesperson insisted the reorganisation “will improve services and save taxpayers’ money”.

Ministers talked up the potential to save cash as one of many predominant advantages of native authorities reorganisation.

Speaking to MPs in June, Rayner mentioned: “Local government reorganisation will lead to better outcomes for residents and save a significant amount of money that can be reinvested in public services and improve accountability.”

But her division insisted it was not essential to fee separate in-house evaluation of the price of reorganisation on the public’s expense, in response to the BBC’s freedom of knowledge request.

The authorities’s financial savings estimates have been primarily based on information produced by PwC, an accounting agency, and analysis by the CCN, a cross-party lobbyist group.

A PwC report in 2020 estimated potential financial savings of £2.9bn over 5 years if all councils in two-tier areas have been changed by single authorities.

But in updated analysis this year, the CCN mentioned the reorganisation may value £850m over 5 years and ship no financial savings if 58 new councils, primarily based on a minimal inhabitants of 300,000, have been created in all 21 two-tier areas.

“Under this scenario no long-term efficiency savings would be delivered, meaning it would be more efficient to retain the current two-tier system in England,” the CCN’s evaluation mentioned.

Oliver mentioned the CCN’s evaluation confirmed “that splitting county areas into unitary councils with populations as small as 300,000 will create hundreds of millions of new unsustainable costs for local taxpayers”.

The councillor mentioned the federal government should guarantee the brand new councils created are the proper measurement to realize efficiencies, enhance capability and face up to monetary shocks.

“Failure to do so could pile further strain on already under pressure care services and at a time when many county and district authorities could see their funding reduced,” Oliver mentioned.

The District Councils’ Network (DCN) mentioned the reorganisation may produce poor outcomes given the funding pressures already going through native authorities.

“It’s astonishing that the government has undertaken no independent analysis before embarking on the biggest reorganisation of councils for 50 years,” mentioned Sam Chapman-Allen, chair of the District Councils’ Network.

“Mega councils, with populations of half a million people or more, could be imposed on areas when there’s no independent, up-to-date evidence to justify councils of this size, and many large councils created previously are struggling financially.”

The DCN mentioned it was not too late for the federal government to fee evaluation on the optimum measurement of councils to maximise potential financial savings.

Liberal Democrat deputy chief Daisy Cooper mentioned: “It beggars belief that the government has embarked on a huge reorganisation of vital services, in a way which piles even more costs onto councils, whose finances are already on the brink.”

Stephen Atkinson, Reform UK chief of Lancashire County Council, mentioned: “It is extraordinary that Angela Rayner is pushing ahead with these huge changes to local government without either proper consultation or any independent analysis of how much it might actually cost.

“To make elementary adjustments to twenty councils in a single 12 months is unprecedented and can result in weak youngsters and adults falling between the gaps.”

The Ministry of Housing, Communities and Local Government said: “Councils throughout the nation have additionally instructed us that bringing companies collectively below one roof means residents get joined-up help once they want it most, whereas clearer buildings imply individuals know precisely who’s accountable for delivering their companies.

“Councils will also develop their own proposals for how reorganisation works best in their areas, as we fix the foundations of local government through our Plan for Change.”