Conclusion
In conclusion, our proposed model of three unitary authorities for the future of local government in Surrey promises significant financial benefits by reducing duplication, achieving greater economies of scale and capitalising on opportunities for service transformation and improvement. Establishing financially sustainable and value-for-money unitary authorities is crucial to ensure lasting economic growth and high-quality, sustainable public service delivery.
Our analysis confirms that the proposal is financially viable, offering substantial savings compared to the current two-tier system. However, each new council will face financial challenges, including existing budget pressures, growth in demand for services (particularly adult and children's social care), inflationary pressures and the anticipated impacts of Fair Funding reform.
Our approach to evaluating the financial viability of the proposed unitary authorities has involved assessing savings from fewer elections, councillors, and senior managers, and eliminating duplication to achieve service delivery efficiencies. These savings are offset against the costs of disaggregating upper-tier services and implementing changes, such as redundancies, new digital infrastructure, running a shadow authority, and project management, resulting in a net cost/benefit for the proposals.
The new authorities must use savings from local government reorganisation to address these pressures and deliver savings to maintain service quality and scope.
Based on the analysis of 11 examples of local government reorganisation across England since 2009 and PwC's 2020 report on Surrey's reorganisation options, our modelling, developed in close collaboration with district and borough Section 151 officers, confirms the financial viability of the proposal. However, despite the potential for significant annual savings, much of this will be needed to address forecast budget pressures. Stranded debt remains an unresolved issue, which we hope to discuss further with the government.
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