The Government did not conduct its own assessment of the costs of local government reorganisation, the BBC has revealed.

Deputy Prime Minister Angela Rayner previously claimed merging councils into unitary authorities in 21 areas would save ‘a significant amount of money.’

Ministry of Housing, Communities and Local Government (MHCLG) relied on a 2020 PwC report commissioned by the County Council Network (CCN), which estimated £2.9bn in savings across five years could be made if all 21 two-tier areas were replaced with a single unitary council in each area.

Updated figures published by CCN in March 2025 suggested 29 unitary councils with populations over 500,000 could still save £1.8bn. But replacing the two-tier system with 58 smaller councils, some with just 300,000 residents, could cost £850m over five years and deliver no long-term savings.

Cllr Tim Oliver, chair of the County Councils Network, said: ‘While it may be necessary for some areas to create more than one new council, it is absolutely essential that the Government scrutinise and rigorously evaluate all proposals against their own statutory criteria, including ensuring new councils are the right size to achieve efficiencies, improve capacity and withstand financial shocks.

‘Failure to do so could pile further strain on care services that are already under pressure and at time when many county and district authorities could see their funding reduced as part of the Fair Funding Review.’

An MHCLG spokesperson said that local government reorganisation ‘will improve services and save taxpayers’ money.’

‘Councils across the country have also told us that bringing services together under one roof means residents get joined-up support when they need it most, while clearer structures mean people know exactly who's responsible for delivering their services,’ they said.

‘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.’