UK councils are merging – what are the implications?

Councils merging together is not exactly a new concept, but from 2025 onwards the landscape of local governance in the UK is going to undergo significant transformation. While the goal of this overhaul is to streamline government structures into super-entities (who might finally agree on standardised waste bin colours), there are obviously going to be benefits and challenges to this approach. What exactly are the implications of countrywide council mergers and the impact on digital technology currently in place?

Gains in economic efficiency, but losses in local representation?

By consolidating services, the UK Labour government claims there could be savings to the tune of £2 billion, which would be handy given the financial strain many councils have been under since 2008. With the right leadership, this could mean better allocation of resources towards essential services like housing, policing, and public health, all of which are critical in driving economic growth and improving quality of life. However, there is a risk of impacting on local identity and representation. The consolidation of councils might distance decision-making from the communities they serve, potentially damaging the local voice in governance.

Devolution and local service delivery

The government’s push for mergers is intertwined with its “devolution by default” agenda, aiming to give more power to regional leaders. The execution of this devolution has sparked debate around “one-size-fits-all” approaches that may not cater to the unique needs of different areas.

Restructuring would alter how services are delivered, and while larger unitary authorities might offer economies of scale, there is a risk of losing nuanced understanding of localised issues. The transition might also mean a temporary dip in service quality as councils adjust to new structures, roles, and responsibilities. This includes concerns from local leaders about the potential for councils to be “lumped in with failing councils,” risking strong local governance being compromised by association with less effective counterparts.

Political and administrative challenges

Politically, these councils mergers favour more mainstream parties as opposed to smaller parties or independents who thrive within their communities as they understand and address their local issues. Administratively, the process of merging involves not just logistical challenges but also reconciling different council cultures, systems, and priorities. There has been skepticism in the past about whether these mergers will actually lead to the promised savings or if they will end up being more of a “distraction” from the real task of service reform.

What about the technology implications for councils?

To put it plainly, the implications are significant. Different councils often operate on separate platforms within each of their service areas – finance, HR, customer services, frontline workers, streets and grounds teams, highways, etc. Decisions will need to be made on whether to consolidate, replace, or maintain multiple systems within merged authorities. There is also the challenge of data migration and cybersecurity, as multiple authorities will need to merge their separate customer and transactional data sets whilst complying with GDPR.

Service delivery will also be affected. Customers and businesses depend on digital platforms for essential services such as council tax payments and benefits applications. IT staffing and procurement will also see major restructuring in order to align with new ways of working, which may lead to redundancies or the need for further digital training. In the short-term this will likely result in a high financial impact, but if handled professionally there is an opportunity for long-term efficiency gains through streamlined operations.

What about the technology implications for vendors?

For technology, council mergers present big opportunities and big challenges. As councils seek to consolidate services, reduce costs, and streamline operations, vendors with existing contracts may face abrupt renegotiation. In some cases, systems may be replaced entirely, or scaled up across a larger regional authority, so while vendors are at risk of losing business, there are also expansion opportunities. Vendors offering flexible multi-purpose solutions capable of integrating with legacy systems will naturally have a competitive edge over overspecialised offerings.

With a push for cost reductions and efficiency improvements, vendors will need to be able to demonstrate clear value to councils such as automation, cloud adoption, and improved customer engagement tools. Ultimately, those who can offer scalable, cost-effective, and integrated solutions will be best positioned to thrive in this evolving landscape.

Conclusion

The merging of UK councils presents a complex scenario where the promise of efficiency and increased local power through devolution must be balanced against the potential loss of local identity, representation, and immediate service quality. As these changes roll out, the effectiveness and reception of this restructuring will hinge on how well these new entities can maintain the local touch while achieving broader, more strategic governance goals.

Regardless, success depends on more than just consolidation of authorities. It requires a cultural shift within them, where staff at all levels embrace accountability, owning their services, and adopting new ways of working. Training and upskilling the workforce is just as important as deploying the latest software. With smart strategies, a clear focus, and a willingness to embrace change, councils can navigate financial challenges.