The Independent Revenues and Benefits Monday Discussion Group focused this week on two connected pressures facing local government: local government reorganisation and the growing financial strain caused by council tax dependency, adult social care demand and wider public service pressures.
With Malcolm Gardner unwell, Rachael Walker chaired the session and opened the discussion by framing local government reorganisation as a major operational, financial and political challenge. Her central concern was not simply whether new unitary authorities could be created, but whether the system is ready to absorb change on this scale and within the timetable being discussed.
Rachael noted that some councils already know their future footprint, while others are waiting for decisions expected over the summer and autumn. She highlighted the uncertainty caused by legal challenges, contested proposals and the possibility that some government decisions may not align with the original design principles, particularly where proposed new authorities fall below the population size previously indicated.
Her view was that uncertainty is itself one of the biggest risks. Residents, staff and services are all affected when councils do not know what structure they will be working within. She also questioned how financially fragile councils will cope if reorganisation happens alongside existing debt, transformation pressures, section 114 risks and insufficient funding for transition.
Laura Bessell offered one of the calmest perspectives on local government reorganisation. Speaking from an authority directly affected by the process, she said that what keeps her awake at night is, at present, “nothing”. Her view was that councils should not panic before formal decisions are made. Until the footprint is confirmed, too much detailed work risks being wasted or misdirected.
However, Laura was not suggesting inactivity. She explained that in Oxfordshire there is already a strong working group in place, with councils comparing caseloads, systems, contract dates, data sets, council tax reduction schemes and policy positions. Her argument was that councils should prepare intelligently, but not pretend they know the final answer before ministers have made decisions.
For Laura, the greatest immediate risk is staffing. She said different staff groups will react differently: some may look towards retirement or redundancy, others may worry about having to reapply for jobs, and some may see opportunity for promotion. Her view was that 2026 should be used to support staff, understand skills, prepare people for change and create a base position for the more intense work likely to follow.
Tom Clark took a pragmatic view. He argued that councils are not “reinventing the wheel” and should learn from places that have already reorganised, including Buckinghamshire, Somerset and North Yorkshire. His view was that there are clear lessons from earlier reorganisations, particularly around systems, reconciliation and administration.
Tom was critical of some of the public rhetoric around local government reorganisation, particularly where it came from organisations defending the district model. He felt some of it bordered on scaremongering. His view was that many councils already work together operationally through shared contracts, common systems or joint arrangements, so reorganisation may formalise relationships that already exist in practice.
He was also critical of the cost of reorganisation consultancy and senior project roles, pointing to high day rates and questioning whether money could be better spent on practical delivery. However, he also saw opportunities in moving to unitary status, particularly for Revenues and Benefits teams that will have closer links with adult social care, appointeeships, deputyships and wider community support.
Michael Fisher introduced a more cautious systems perspective. His main concern was whether software suppliers have the capacity to support multiple councils reorganising at the same time, at different speeds and with different system combinations. He warned that suppliers themselves have lost experienced staff and may not have the depth of knowledge available during previous reorganisations.
Michael drew attention to the complexity of areas such as Lancashire, where several councils use different suppliers and there are longstanding shared services. His view was that system selection, database migration and the unwinding of shared service arrangements could become major operational risks. A ministerial decision on boundaries may look simple from Whitehall, but it can unsettle years of local operational collaboration.
Paul Howarth focused on council tax reduction. His view was that authorities coming together under local government reorganisation should begin identifying common ground between their schemes as early as possible. He suggested that, in many areas, the differences may be manageable, although the gap between default style schemes and income banded schemes could be more significant.
Paul’s legal view was clear: the legislation requires the authority to make a scheme. In his opinion, a new unitary authority attempting to operate multiple council tax reduction schemes for different parts of its area would be open to challenge. He therefore saw harmonisation as legally important, even if politically and financially difficult.
Kevin Stewart broadly agreed. He warned that if a single new authority operates different schemes in different areas, it may expose itself to judicial review. His view was that councils should be preparing from the first day a decision is made, building relationships, sharing information and engaging members and senior leadership teams early.
Kevin also raised the local government pension changes expected from April 2028, suggesting that some staff considering their options during reorganisation may be affected by the shift in pension ages. More broadly, he warned that reorganisation may bring savings in the long term, but is likely to create additional work and cost in the short term.
Sean O’Sullivan added an important legal and practical dimension. He reminded the group that Revenues and Benefits teams have delivered huge reforms before, often at speed, including council tax reduction itself. He contrasted this with the long timescales taken by national welfare reform programmes.
On council tax reduction, Sean noted that it is a discretionary discount within the council tax system. He questioned whether legal challenge would necessarily follow in every case where different localised arrangements existed, particularly given the complexity of council tax levels, parish precepts and transitional arrangements. However, he was clear that any new scheme would require proper consultation, evidence and process. His warning was direct: councils cannot simply force a new scheme through without meaningful consultation.
Sean also highlighted shared services as one of the biggest hidden risks. In areas where districts are currently paired with different partners for housing, revenues, benefits or fraud services, reorganisation could require complex disentangling of contracts, staffing and operational arrangements.
Rachael agreed that consultation may become a weak point in the process. She stressed the importance of meaningful consultation, not merely a technical exercise. She referred to the principles that underpin lawful consultation and warned that councils waiting to do “absolutely nothing” until forced to act are taking a dangerous approach.
The discussion then moved to wider council finance, with Rachael setting out the strategic importance of council tax. Her view was that council tax has moved from being an important local tax to a critical pillar of council funding. She warned that if council tax continues to rise while household incomes remain under pressure, there may eventually be a tipping point where collection becomes harder and arrears increase.
Gareth Morgan gave a sharply political view from outside English local government. He argued that English councils risk driving residents towards that tipping point by reducing council tax support. In his view, councils may be creating more of their own collection problems by reducing the help available to low income households.
Gareth also warned that local authorities can appear remote from the communities they serve, particularly when boundaries feel artificial and residents do not feel connected to the new structures being created. He argued that councils need public buy in, otherwise they risk being seen only as a body that demands money while giving less back.
Kevin returned to the evolution of council tax, arguing that it began as a property tax but is now used as a wider funding mechanism for local services. He also pointed to the split between pension age and working age council tax reduction. His view was that working age households have carried much of the burden of reductions, while pensioners remain politically protected.
Paul reflected on the earlier review of council tax reduction arrangements and noted that government had considered more flexibility for local authorities, including in relation to pension age schemes, but had chosen not to proceed. His view was that councils have never really been given the chance to make council tax reduction fully workable as a single coherent system.
Gareth challenged the idea that reducing benefits creates savings in any meaningful economic sense. He argued that benefits are a transfer, not a lost spend, because money paid to low income residents is usually spent locally, supporting businesses and jobs. Paul accepted that argument as one way of looking at it, but said political reality makes significant benefit increases difficult.
Laura then brought the discussion back to the hard choices facing section 151 officers. She said councils may value council tax reduction and discretionary support, but they also have to fund swimming pools, roads, infrastructure, public health and statutory services. Her view was that councils are now in a position where every penny matters, and even small discretionary decisions must be seen in the context of wider community need.
Sean closed the policy discussion by warning that council tax reduction does not save money for the Treasury, so central government is unlikely to focus on it as a direct saving. Instead, the pressure is more likely to come through wider reductions or constraints in local government funding, particularly as national spending priorities shift towards defence, health and pensioner protection.
The overall mood of the discussion was not panic, but realism. Speakers agreed that Revenues and Benefits teams have repeatedly delivered major reform under pressure. They also agreed that the profession is often under recognised for doing so. The strongest message was that councils should avoid both extremes: they should not panic before decisions are made, but nor should they wait passively.
The practical priorities identified were clear: understand neighbouring authorities, map systems and contracts, compare policies, prepare staff, engage senior leaders, plan consultation properly and treat council tax reduction as a core strategic issue rather than a technical back-office function.
Local government reorganisation may be presented as a structural reform, but for Revenues and Benefits teams it is much more than a boundary change. It affects residents’ bills, benefit entitlement, recovery practice, staffing, systems, shared services, equality duties, consultation and public trust. As the group made clear, the success or failure of reorganisation will depend heavily on whether these operational realities are understood early enough.
The rcording can be found here