Dr Luke Evans, Member of Parliament for Hinckley and Bosworth, has called on the Government to “sort out a mess of their own making” after analysis of Local Government reorganisation proposals finds the move to unitary councils could make no savings or, in some scenarios, cost money.
Earlier this year, the Secretary of State for Local Government, Angela Rayner, brought forward plans to merge councils in 21 areas, such as Leicestershire, where two-tier authorities remained.
Rayner's department, the Ministry of Housing, Communities and Local Government, based its cost estimates on a report by the County Council Network (CCN) in 2020 which estimated that £2.9bn could be saved over five years.
However, the CCN has revised its analysis and now says the reorganisation could make no savings and, in some scenarios, may cost money.
The BBC reports that Ministers had talked up the potential to save money as one of the main benefits of Local Government reorganisation.
Speaking to MPs in June, Rayner said: "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 department insisted it was not necessary to commission separate in-house analysis of the cost of reorganisation at the public's expense, in response to the BBC's freedom of information request.
Tim Oliver, chairman of the CCN, said "We are concerned over the potential costs of reorganisation where proposals seek to replace the two-tier system with multiple small unitary councils."
The 2020 report estimated potential savings of £2.9bn over five years if all councils in two-tier areas were replaced by single authorities.
In updated analysis this year, the CCN said the reorganisation could cost £850m over five years and deliver no savings if 58 new councils, based on a minimum population of 300,000, were created in all 21 two-tier areas.
The reorganisation could see local borough or district councils, such as Hinckley & Bosworth Borough Council or North West Leicestershire District Council, absorbed into a new authority. The Government is set to decide on the proposals next year.
However, there has been disagreement locally around how the reorganisation should work. Three proposals have been presented to the Government for the area of Leicester, Leicestershire and Rutland.
One such proposal would see the current county area split into two separate North and South Leicestershire unitary councils with populations of around 400,000 in each.
Another would see one a single unitary for the county, but a greatly expanded Leicester City, moving areas of Leicestershire and into the City boundaries.
The Reform-led Leicestershire County Council are yet to set out their position on what options should be taken forward.
The reorganisation of the council has been thrown into sharp focus in the last month, with the high-profile sacking of the Deputy Council Leader and portfolio holder for adult social care. Questions have been raised over Reform's plan for social care, as over 70% of the County Council's budget is spent on providing support and provision to residents.
There is real concern that the cumulative impact of the Labour Government’s top-down reorganisation of the NHS and funding cuts of up to 50% to Integrated Heath Boards, coupled with local council reorganisation and a Reform-led local Council leadership that is yet to set out its vision, risks damage to services and increased costs to taxpayers.
Dr Luke Evans MP, who has previously criticised the Government’s handling of the proposals, said “I have warned from the start that this is being rushed through.
“First, we were told the changes would save money and improve services. But now we learn that confusion and local disagreement around how unitary councils should look is likely to cost the taxpayer.
“These changes are being forced through at a time when the Government is abolishing NHS England and cutting NHS Integrated Care Board staff by 50%, both of which will have huge ramifications for councils. And what’s more, locally, we’re faced with a fractured Reform leadership at County Hall, most recently with the stripping of positions from the former Deputy Leader and member for adult social care. I'm concerned that the group still has no plan to improve social care support and provision for our communities.
“Residents and council staff deserve answers and stability, but this is turning into a chaotic situation both nationally and locally. The Reform leadership at Leicestershire County Council must come clean; what is its plan for social care? Are they in negotiations over expanding the City boundaries? How will they manage the funding shortfall from giving away bits of the County?
