As Local Government Reorganisation gathers pace, David Parrett, Director at Cadaema Consulting Services, warns that failure to plan for council property portfolios could see history repeat itself.

The 1972 Local Government Act was, until recently the most significant shift in council reorganisation in the UK. In England alone, a previous structure of 1,245 councils, each with its own administrative setup, staffing structures and property portfolios was reduced by over two-thirds to 412.

Alongside standardising the structure of local government, improving access to local services for residents and redrawing the boundary map one of the primary objectives of the Act was to increase administrative efficiency.

Improved efficiency meant reducing resource management (people) at local community level to save on vital resources. To a large extent this was successful. Over the following 40 years, rationalisation of teams, increased use of technology – both in the delivery and access of services from customers – has meant that local government has pretty much cut its cloth impressively.

Where, perhaps, it didn’t forge ahead was through the associated rationalisation of its property portfolio. Impressive legacy buildings continue to occupy space on councils’ property lists, creating maintenance liabilities, utilities costs and racking up facilities costs to keep them operational, often for very few members of staff.

Administrative success or not, the 1972 Act did not effectively plan how the re-mapped local government landscape would manage its property portfolio. This has created significant cost and resource pressures for councils in the forty years that have followed.

Fast forward to the English Devolution White Paper published by the Government in 2024 and the programme of Local Government Reorganisation (LGR). A programme of local government rationalisation with broadly the same objectives: improved efficiency and access to services.

However, does the legislation offer the opportunity to properly plan how the new authorities will manage their estates? If done thoroughly, it should offer the following opportunities for the new organisations:

• Verify portfolio data as part of a due diligence exercise – what buildings they have and, critically, what plant and equipment they contain

• Determine the optimum footprint – what and where are the buildings they need to effectively deliver services

• Confirm market values

• Strategically plan disposal strategies and quantify investment returns and the opportunities that these receipts may create

• Quantify and evaluate capex requirements and lifecycle costs to modernise the existing properties and understand whether they will support wider corporate objectives.

To avoid missing the opportunity again and replaying the 1972 Act, key questions need answers:

• Have property considerations been built into the thinking behind the legislation?

• Is there enough time in the programme to strategically plan this properly?

• Who is responsible for taking that holistic view and choreographing the approach?

• What does good look like at the end of this?

There is a massive challenge ahead – one that shouldn’t be underestimated in terms of property. The result should provide better spaces for residents and investors to access services and work with councils and for local government officers to work. Further, and here’s a thought, maybe any consolidation of space requirements can be used to work towards solving the housing crisis…you never know!

Sponsored by Cadaema.