Local Government Reorganisation: South-east

Debate between Al Pinkerton and Peter Lamb

Tuesday 10th March 2026 Westminster Hall

[Dr Pinkerton]

I am grateful for my hon. Friend’s intervention. Labour may not have broken the local government system in Surrey but there is now an obligation to ensure that people who live in Surrey are not faced with the bankruptcy of their new unitary authorities on day one of those authorities’ existence, especially given the vital services that they will be delivering.

In neighbouring Woking—where there was another Conservative-run council in those fateful years—the gravitational denialism was even wilder. During the same period, Woking borough council accumulated debts that now stand at approximately £2.1 billion. It is said that that debt is so large that it directly impacts the Government’s borrowing capacity in international markets. Versions of that story are repeated across much of west Surrey: it is a pattern of behaviour that has, frankly, never been properly investigated. Its impact has been compounded by systemic failures in the auditing of local government accounts.

[Peter Lamb (Crawley) (Lab)]

Is the hon. Gentleman astounded, as I am, that the majority of that debt is with the public works loan board, which sits underneath the Treasury. Where was the Treasury when that debt was being allowed to accumulate?

[Dr Pinkerton]

I could not agree more with the hon. Gentleman. I will come on to talk about a systemic failure, as I see it, in the power that section 151 officers of borough councils have in effectively signing off the ability of a council to repay debts when accumulated. That is a power that I think may be far in excess of the skills that they have. After all, there is no separate mechanism to determine—from the Treasury or from the PWLB, for example—the ability of a council to fulfil its obligations.

It is therefore entirely reasonable that residents ask a simple question: why should communities that played no role in accumulating that debt now be expected to inherit its consequences through a newly-created local authority? If reorganisation is intended to create a stable future for local government, it would be deeply concerning for any new authority to begin life already burdened with billions of pounds in inherited liabilities. I ask the Minister what assurances the Government can provide that any future West Surrey authority will begin life next year on a financially sustainable footing? It cannot be right that my residents face the realistic prospect of their new unitary authority being bankrupt or effectively bankrupt on day one of its existence, given the critical services that councils are expected to provide.

The scale of borrowing in Surrey also raises wider questions about financial oversight in local government—this is where I will answer the hon. Member for Crawley (Peter Lamb). Local authorities rely on statutory finance officers—section 151 officers—to ensure financial prudence, yet the scale of borrowing undertaken by some councils suggests that existing safeguards have not always been sufficient to prevent high-risk commercial strategies. This debate is often framed in terms of protecting section 151 officers from excessive political pressure, and that may well be necessary, but it is also true that section 151 officers hold significant authority within council structures and must themselves be subject to proper scrutiny and accountability—something that is often lacking.

Councillors very often perceive that they are not allowed to overly scrutinise 151 officers because of members’ codes of conduct. Will the Government therefore consider whether additional safeguards or oversight mechanisms are needed to prevent similar situations arising again in the future, particularly as councils become larger, their finances become more complex and the risks become even greater.

There are also important questions about the size and structure of the authorities now being proposed. Under current proposals, the new West Surrey council would serve approximately 657,000 residents. By comparison, the average non-metropolitan unitary authority in England serves around 265,000 residents, with most serving fewer than 300,000. Authorities of the scale we are talking about today risk weakening democratic accountability, diluting local knowledge and making decision-making feel more distant from the communities they are meant to serve.

Ministers have suggested that having larger authorities will deliver financial efficiencies. In support of that argument, the Government have relied on modelling produced by the County Councils Network, which happens to be chaired by the very same leader of Surrey county council who locked Surrey into this fast-track pathway in the first place. Despite several Parliamentary questions seeking clarification, it remains unclear what independent modelling the Government have undertaken to substantiate those claimed savings. I ask the Minister again: have the Government undertaken their own economic modelling of the projected financial benefits of local government reorganisation in Surrey? If so, will that modelling now be published publicly?

Finally, we should recognise that all of this is unfolding while councils continue to deliver vital services under considerable strain. In my constituency, the concerns most frequently raised with me relate to special educational needs and disabilities provision. Hundreds of families contact me about problems with education, health and care plans—incorrect names, incorrect details, long delays and support packages—that simply do not meet the needs of the children concerned.

For the past three years, Surrey has recorded the highest number of SEND tribunal appeals nationally. At the same time, residents regularly contact me about deteriorating road surfaces, potholes causing vehicle damage and wider infrastructural pressures. These are not abstract policy debates; they are real challenges affecting families who rely on local government services every single day.