Agenda item

Report attached.

 

Appendix 3 – The full Business Case for the 3 Unitary Authority Model is available by clicking the following link:

 

LGR The business case for three unitary authories in Lancashire | Hyndburn Borough Council

Members considered a report of Councillor Munsif Dad BEM JP, Leader of the Council, updating the Council on preparations to submit a proposal for Local Government Reorganisation to Government.

 

The report presented the business case that had been prepared to support the creation of three unitary authorities in Lancashire and included a one-page executive summary of this case.  The full business case had been circulated to members under separate cover following its publication.

 

Councillor Dad provided a brief introduction to the report and highlighted the main reasons for change and the rationale for Hyndburn’s preferred option.  An initial decision taken by the Council earlier in the year to support a 3 Unitary Authority (3UA) model was backed up by the evidence now provided.

 

The Minister of State for Local Government and English Devolution had introduced the English Devolution and Community Empowerment Bill on 10^th July 2025, following the publication of the English Devolution White Paper on 16^th December 2024.

 

The new Bill had announced how the government would facilitate a programme of local government reorganisation (LGR) for two-tier areas and for those unitary councils where there was evidence of failure or where their size or boundaries might be hindering their ability to deliver sustainable and high-quality services for their residents.

 

The Government had set a timeline for Lancashire councils to produce a preferred option for local government reorganisation by the end of November (28^th), asking for proposals to move from the current two-tier system of a county council, two smaller unitary councils and 12 districts councils, to a simpler model of fewer councils.

 

The Government’s aim with LGR was to improve efficiency savings, service delivery, provide stronger local leadership, economic growth, community identity and foster effective local partnerships, while not hindering the ability to deliver sustainable and high-quality services for residents.

 

Government Guidance

 

Government guidance (the Statutory Invitation) set out the following criteria which would be used to assess proposals for reorganisation:

 

• A proposal should seek to achieve for the whole of the area concerned the establishment of a single tier of Local Government;
• Unitary local government must be the right size to achieve efficiencies, improve capacity and withstand financial pressures;
• Unitary structures must prioritise the delivery of high quality and sustainable public services to citizens;
• Proposals should show how councils in the area had sought to work together in coming to a view that met local needs and was informed by local views;
• New unitary structures must support devolution arrangements;
• New unitary structures should enable stronger community engagement and deliver genuine opportunity for neighbourhood empowerment.

 

The criteria above were not weighted, but the intention was to provide guidance to areas to develop proposals that addressed the criteria and were supported by data and evidence.  Decisions on the most appropriate option for each area would have regard to the guidance and the available evidence.

 

Under the Local Government and Public Involvement in Health Act 2007, the Council had to submit a proposal based on whole Local Authority Districts, but could request that the Secretary of State used their modification power in sections 7 and 11 of the 2007 Act to adjust the boundary subsequently.  In the guidance, the Secretary of State had also expressly allowed for the submission of proposals that suggested boundary changes.

 

Proposals

 

Councils in Lancashire had worked together to identify possible options for reorganisation.  The Government had provided funding to develop a shared evidence base across Lancashire councils, including both socio-economic baseline data for the options, a public and stakeholder engagement process and finance data.

 

It was intended that a joint letter would be sent to the Minister by Lancashire Leaders to accompany the various business cases that were being submitted.

 

The various cases would be taken to councils throughout Lancashire ahead of the deadline for submission of proposals on 28^th November 2025.

 

Currently there were five proposals based on the following models:

 

• Model 1 consisted of Lancashire being split into 2 large unitary councils with a North / South divide
• Model 2 consisted of 3 unitary councils (Coastal / Central / Pennine)
• Models 3 consisted of 4 unitary councils (North / South / East / West)
• Model 4 consisted of 5 smaller unitary councils (North / South / Middle / East / West)
• Model 5 was the Blackpool proposed four unitary model

 

The report included colour-coded maps of the five models referred to above and an explanation of the make-up of each of the unitary authorities proposed and population sizes for each model.  The 3UA model (Model 2) preferred by Blackburn with Darwen, Fylde, Hyndburn, Rossendale and Wyre would see new authorities based upon the following district council footprints;

 

• Coastal Lancashire (Blackpool, Fylde, Lancaster and Wyre);
• Central Lancashire (Chorley, Preston, South Ribble and West Lancashire);
• Pennine Lancashire (Blackburn with Darwen, Burnley, Hyndburn, Pendle, Ribble Valley and Rossendale).

 

Timeline

 

Delivering LGR in Lancashire would be a complex and far-reaching programme of change.  The proposed timeline was intended to allow sufficient time to plan, implement and embed the new arrangements while maintaining service continuity and public confidence.

 

The indicative timeline below set out the key phases and milestones for implementation.  It was designed to ensure a smooth transition from the decision to proceed with reorganisation through to the establishment of fully operational new councils.

 

The decision on Hyndburn’s preferred option would be made by Cabinet on the 19^th November, with the three unitary authorities (3UA) business case option being made available on 7^th November.

 

The timeline for Local Government Reorganisation was currently as follows:

 

·         November 28^th, 2025: Councils to submit proposals to Government;

·         Early 2026: Government-led public consultation on proposals for new unitary councils;

·         Summer 2026: Government would select the preferred unitary council option;

·         May 2027: Elections would take place for a Shadow Authority for each of the new unitary councils; and

·         April 1st, 2028: “Vesting Day”, when new unitary councils would start to operate all services and the existing 15 authorities were abolished.

 

The report included a pictorial representation of the above timeline in the style of a Gantt chart.

 

Findings and Recommendations

 

On the 16^th January 2025, following the publication of the English Devolution White Paper the Council had recommended supporting the creation of a Pennine Lancashire Unitary Authority (which included Blackburn with Darwen, Burnley, Hyndburn, Pendle, Ribble Valley and Rossendale).

 

Currently, the Council’s preferred option was the three-unitary model for Lancashire.  The business case prepared in respect of the options suggest that this was the only configuration that met all six of the Government’s criteria for local government reorganisation, while reflecting the way Lancashire’s economy, services and communities already worked and providing the best platform for the future.

 

The three-model business case had been developed following a detailed options appraisal, including data analysis and assessments of the evidence base.

 

It was considered that other options all fell short of what Lancashire needed.  A two-council model would be too large and remote, misaligned with key service boundaries and financial risk.  A four-or five council model would fragment economic corridors, create uneven capacity and weaken the devolution case.

 

The business case concluded that only the three-council model aligned with real economics and service footprints, balanced risk, kept decision-making local and met every Government test without compromise.

 

The benefits of the three-model business case was making services clearer without creating councils that were too large and remote or too small to make a difference.  Matching NHS and Police footprints, which none of the other options did, meant a much greater ability to work collaboratively with strategic leadership.

 

The business case indicated that the three unitary model delivered a sustainable future for Lancashire through a stronger, more balanced financial case than any of the other proposed options, combining credible savings with the capacity to invest in services, work with partners, support economic growth, unlock deeper devolution, and connect at a local level to places people lived, worked and learnt in.

 

A table was provided within the report summarising the different options by government criteria.  As stated previously, the findings indicated that the three unitary model was the only configuration that met all six of the Government’s criteria for local government reorganisation.

 

The report also set out an infographic, which showed the vision behind the case for three unitary authorities for Lancashire, which included the following statement:

 

“Our vision is for three new unitary councils, balanced in scale and rooted in real places, to create the capacity and clarity needed to unlock Lancashire’s potential.  They will deliver stronger services for geographies that reflect places, communities and key partner footprints, give businesses and government credible partners for growth and devolution, and reconnect decision-making to the places people live, work and learn in.”

 

Consultations

 

Communities and stakeholders across the county had been invited to have their say on local government reorganisation in Lancashire.  Two surveys had been conducted across September 2025 to understand which council services Lancashire residents saw as most important, priorities for local government to focus on in the future and initial thoughts on moving to larger unitary councils.

 

The community survey had been promoted across the county to ensure a broad range of voices contributed to the discussion.  13,414 respondents had filled out the survey, including 67,784 individual written comments in answer to the open text questions, showing a genuine interest and high level of engagement from Lancashire.

 

A total of 409 responses had been received for the stakeholder survey, representing over 200 unique organisations and individuals.  Respondents had included parish and town councils, businesses, voluntary and community groups and public sector organisations.

 

Two reports had been produced, summarising the results of the surveys which were undertaken by Cratus Group, an independent agency on behalf of Lancashire’s local authorities.  This information would now be used to inform the developing proposals for submission to Government in November 2025.

 

What people highlighted across the engagement was that services that mattered most to local people were those that touched daily life and wellbeing, such as good health and care services, reliable and accessible transport, affordable housing and good schools and opportunities for children.  Community identity and connection remained strong.  Clarity and simplicity were recurring themes in written feedback.  Residents and businesses wanted less duplication, clearer responsibility for services that were more consistent and reliable, and a stronger link between local decisions and visible outcomes.  Partnership working and fairness had also been also emphasised, with many respondents highlighting the importance of tackling inequalities across Lancashire and ensuring all areas had equal access to good quality local job opportunities, services and investment.

 

In the absence of Councillor Aziz, Chair of the Resources Overview and Scrutiny Committee, the Mayor read out a statement which summarised the discussions held at a meeting of that Committee on 11^th November 2025.  At that time, members had been given the opportunity to consider Local Government Re-organisation and the Council’s preparations to submit a proposal to Government.

 

The Committee had held in-depth discussions, considering many issues including:

 

• the reasons for forming new unitary authorities;
• the timescales involved;
• the impact on the residents of the Borough;
• the impact on the Council’s finances and staff;
• local representation; and
• the potential benefits in the future.

 

The Committee had been informed that Hyndburn Council intended to propose the three unitary authority model and felt that the evidence provided in the business case for the creation of three unitary authorities proved to be the most suitable fit and the best of the proposed models.  Consequently, by a majority vote, the Committee had recommended to support the Council’s proposal for the three unitary model in Lancashire.

 

The Committee had also recognised the merits of the proposal for postponing local elections in 2026 to ensure continuity in Council services prior to a Shadow Council being formed the following year.  The Committee, therefore, by a majority vote, had also supported a recommendation to defer the 2026 local elections.

 

The recommendations as set out in the report were MOVED and SECONDED.

 

Mr Welsby, Chief Executive, added that he had attended the Overview and Scrutiny Committee.  The report before Council today had been prepared before that meeting and its recommendations simply proposed to note the report on the local government reorganisation proposals and sought comments on the options under discussion.  In the light of the Overview and Scrutiny Committee’s recommendation, he asked whether the Council might wish to adopt the same stance as its formal decision.

 

Councillor Paul Cox moved the following AMENDMENT to add the following recommendations, after the words ‘That the Council agrees: (1) To note the report on the local government reorganisation proposals.’:

“

“(2)  To support the three unitary authority model for local government reorganisation in Lancashire and recommends that the Cabinet approve the necessary submission to the Ministry for Housing, Communities and Local Government.

 

(3)    To recommend that Cabinet requests the Government to postpone the 2026 local elections for Hyndburn.”

 

The amendment was seconded by Councillor Dad.

 

Councillors Zak Khan spoke about taking time to consider the matter carefully, particularly as the business case had only recently been published.  He noted that the Overview and Scrutiny Committee’s decision was not unanimous.  He also raised concerns about Hyndburn being ‘swallowed up’ and about the effect of the any new authority taking on the financial burdens of existing councils whose financial management had been less effective than Hyndburn’s.  He asked:

 

• Whether the Council’s views would make a difference to the Cabinet’s preferred option;
• What the view of Hyndburn’s residents had been during the consultation exercise;
• Whether Hyndburn’s views would make a difference to the Government’s final decision;
• Whether the Council should maximise its use of reserves before the new authorities were established.

 

Councillors Clare Yates, Fazal Shabir, Mohammed Younis, Andy Gilbert, Paul Cox, Danny Cassidy, Bernard Dawson spoke in favour of the 3UA proposals to varying degrees.  Some members expressed support on the basis of the 3UA option being co-terminus with health, police and fire service boundaries, or on the grounds of future financial and economic benefits for the community.  Others were simply keen to make the best of a change that was seen as inevitable.

 

Councillor Shabir spoke against the postponement of the local elections in 2026, which he considered was a fundamental democratic right.  Councillors Steven Smithson, Mohammed Younis, David Heap, Danny Cassidy echoed this opinion.  Councillors Andy Gilbert and Mike Booth spoke in favour of the postponement of the elections.

 

Councillor Steven Smithson commented on a lack of detailed evidence about what Hyndburn residents wanted.  Councillor Scott Brerton reminded members that the Cabinet would make the final decision on the preferred model.  He was of the view that Hyndburn had been more transparent than many other authorities throughout the consultation process.

 

Councillor Judith Addison outlined the size of the population typically represented by ward councillors in unitary authorities and expressed concern about the ability of elected members to manage that workload.

 

Councillor Dad summed up highlighting the Hyndburn had been the first Lancashire local authority to publish the business case and that it had been both open and transparent throughout the whole process.  The decision on whether, or not, to postpone the elections would be taken by the Government, not by the Leader of the Council.  The initial preference for a 3UA option had been highlighted as early as January 2025.  The evidence had now vindicated that choice.  He noted that there were precedents for the postponement of elections in advance of local government reorganisation both in the Cumbra area in 2021 and in multiple council areas in 2025.  Accordingly, he was in favour of recommending the 3UA model to Cabinet and seeking the postponement of the local elections in 2026.

 

Councillor Fazal asked if the Council could vote on each element of the amendment separately, particularly as some members might have a conflict of interest if their seat was up for election in 2026.  The Chief Executive responded that, unless agreed otherwise by the Council, the amendment would be taken as a whole.  Councillor Whitehead added that she had sought legal advice on the matter of a potential conflict of interest and that she intended to abstain.  The Chief Executive clarified that the Council was not the decision taker on the matter of the election recommendation and, therefore, there was unlikely to be a conflict of interest.

 

Councillor Younis supported the separation of the two elements of the amendment, as he believed that this would result in a truer reflection of support for each issue.  The Chief Executive invited the mover of the amendment Councillor Paul Cox to consider splitting the amendment into two parts.  Councillor Cox agreed to alter the amendment accordingly.

 

The following AMENDMENT was then put to the VOTE.  The addition of the following words:

 

“(2)    To support the three unitary authority model for local government reorganisation in Lancashire and recommends that the Cabinet approve the necessary submission to the Ministry for Housing, Communities and Local Government.”

 

The above AMENDMENT was CARRIED.

 

The next AMENDMENT, as detailed below, was then put to the VOTE.  The addition of the following words:

 

“(3)    To recommend that Cabinet requests the Government to postpone the 2026 local elections for Hyndburn.”

 

In accordance with Council Procedure Rule 16.5, six members called for a recorded vote on the amendment at (3) above, the outcome of which was as follows:

 

For (11)

 

Councillors Vanessa Alexander, Mike Booth, Steve Button, Paul Cox, Munsif Dad BEM JP, Stewart Eaves, Melissa Fisher, Andy Gilbert, Clare McKenna, Dave Parkins, and Clare Yates

 

Against (8)

 

Councillors Judith Addison, Shabir Fazal OBE, David Heap, Zak Khan, Kath Pratt, Steven Smithson, Tina Walker and Mohammed Younis.

 

Abstain (7)

 

Councillors Josh Allen (Mayor),Scott Brerton, Danny Cassidy, Jodi Clements, Bernard Dawson MBE, Peter Edwards and Kimberley Whitehead

 

Accordingly, the AMENDMENT was CARRIED.

 

There was no debate on the substantive motion, which was then put to the VOTE immediately and was CARRIED.

 

Resolved                                    -    That the Council agrees:

 

(1)   To note the report on the local government reorganisation proposals.

 

(2)   To support the three unitary authority model for local government reorganisation in Lancashire and recommends that the Cabinet approve the necessary submission to the Ministry for Housing, Communities and Local Government.

 

(3)   To recommend that Cabinet requests the Government to postpone the 2026 local elections for Hyndburn.

 

With the agreement of the meeting Item 10 on the Supplemental Agenda was taken next.