Local Government Reorganisation: South-east

Jim Shannon Excerpts

Tuesday 10th March 2026 Westminster Hall

[Dr Al Pinkerton (Surrey Heath) (LD)]

I beg to move,

That this House has considered the impact of local government reorganisation in the South East.

It is a pleasure to serve under your chairmanship today, Mr Vickers. I am grateful to the hon. and right hon. Members from across the House who will be contributing to this debate.

Local government is the tier of government that is most closely woven into people’s everyday lives. It is where national decisions become local realities: the roads we drive on, the services that support vulnerable families, the planning decisions that shape our towns and the community spaces that bring people together. It is for that reason that I support the principle of devolution. Decisions should, wherever possible, be taken by those closest to the communities they directly affect. But as is so often the case in public policy, the difficulty is not the principle, it is the implementation.

In Surrey, implementation is already raising serious concerns about scale, financial sustainability and a process that has moved forward with a troubling democratic deficit. This debate concerns the south-east of England more generally, but colleagues from across the region will speak about how reorganisation is affecting their own counties and communities. My perspective naturally comes from Surrey, where those concerns are already becoming clear. Size, remoteness and financial fragility are among them, and we must add to that mix the glaring democratic deficit.

[Jim Shannon (Strangford) (DUP)]

I commend the hon. Gentleman for securing this debate. I spoke to him beforehand, so he knows what I am going to say. I want to support him—that is the reason why I am here—and I want to give an example that happened in my constituency and which is similar to what the hon. Gentleman is referring to. Two councils, Ards and North Down, were merged together, and one issue that was put forward as a “must do” was the financial and administrative savings with two councils being able to do the job of one, but that did not work out. Does the hon. Gentleman agree that while efforts to streamline governance should be welcomed, more action must be taken to provide adequate financial support to cover one-off reorganisation costs without compromising the delivery of services such as, for example, waste services?

[Dr Pinkerton]

As ever, I am grateful to the hon. Gentleman for his thoughtful, sagacious intervention. He will discover, if he is able to stay for the rest of my speech, that I will cover those fundamental topics: the funding of the transitional moment, and the certainty that joining two authorities together does produce long-term savings and the modelling that those assumptions rely on.

In late 2024, Surrey was placed on a fast-tracked path towards local government reorganisation. That process was triggered when the leadership of Surrey county council requested that the Government cancel the local elections that were scheduled for May 2025. That request was granted, and the result is that councillors elected in 2021 will now remain in office until April 2027, two years beyond their original mandate, and oversee one of the most significant and consequential restructurings of local government in our county’s history. The idea of cancelling elections has, more recently, fallen out of favour with both the Government and, as I understand it, the Conservative party. Sadly, for those of us in Surrey, that realisation came only after the Surrey Conservatives pulled the trigger on the policy that the Government had placed before them. Whatever one’s view of reorganisation, it is difficult to argue that such a profound change should proceed without giving residents the opportunity to pass judgment on those leading it. Local government reform should be carried out with democratic consent, not in its absence.

Alongside those democratic concerns sit serious financial questions. Over the past decade, several councils across Surrey pursued large-scale commercial property investments in an attempt to generate income as central Government funding declined. In some cases, those strategies have left councils carrying extremely substantial debt. The six councils that could form the proposed West Surrey council—Woking, Spelthorne, Guildford, Runnymede, Surrey Heath and Waverley—collectively carry around £4.5 billion-worth of debt. In my constituency, the then Conservative-led Surrey Heath borough council speculated wildly on commercial property between 2016 and 2019. It spent £113 million on a shopping centre with a knackered roof and a former department store riddled with asbestos. At the time, those purchases were described by the council’s then chief executive as “investments” that would help to secure the council’s long-term financial viability as Government funding declined. In practice, it amounted to a Conservative-run borough council borrowing heavily on the financial markets and through the public works loan board in the hope of defying the gravity of the cuts coming from Conservative central Government. Today, those assets are estimated to be worth around £30 million—not the original £113 million. They are operationally loss-making and together risk bankrupting my borough before we even reach unitarisation next year. Surrey Heath cannot afford to keep them but cannot afford to sell them because selling would crystallise the losses it has incurred.