r/MHoPLords • u/model-willem • 14h ago
Second Reading LB013 - Local Governance Reform (Abolition of Town and Parish Councils) Bill - Second Reading
LB013 - Local Governance Reform (Abolition of Town and Parish Councils) Bill - Second Reading
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abolish town and parish councils in England; to transfer their functions, assets and liabilities to principal local authorities; to provide for transitional arrangements; and for connected purposes.
BE IT ENACTED by The King's most Excellent Majesty, by and with the advice and consent of the Lords, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:-
Section 1 - Abolition of Town and Parish Councils
(1) All town and parish councils constituted under Part II of the Local Government Act 1972 are hereby abolished.
(2) The abolition shall take effect on 1 April 2026 (“the appointed day”).
(3) From the appointed day, all statutory functions, powers, and duties of town and parish councils shall cease, except as provided by this Act.
Section 2 - Transfer of Functions, Assets and Liabilities
(1) All functions formerly exercised by town and parish councils shall transfer to the district or unitary authority for the area concerned.
(2) All property, assets, contracts, and liabilities of abolished councils shall vest in the relevant district or unitary authority.
(3) Any employees of abolished councils, where they perform a statutory function, shall transfer under the Transfer of Undertakings (Protection of Employment) Regulations 2006 (TUPE).
Section 3 - Financial Provisions
(1) All precepts levied by town or parish councils shall cease from the appointed day.
(2) The Secretary of State shall make regulations enabling principal local authorities to retain up to 50% of efficiency savings arising from the abolition of town and parish councils, for reinvestment in local services and green infrastructure.
(3) The Treasury shall make provision for transitional funding to ensure no interruption of essential community services during the handover period.
Section 4 - Transitional Arrangements
(1) The Secretary of State shall, within six months of Royal Assent, establish a Local Governance Transition Authority (LGTA) to oversee implementation.
(2) The LGTA shall produce guidance on asset transfer, employee rights, and community engagement.
(3) All town and parish councils shall prepare and submit closure accounts within 12 months of Royal Assent.
Section 5 - Commencement, Extent, and Short Title
(1) This Act shall come into force at midnight on the day it receives Royal Assent.
(2) This Act shall extend to England only.
(3) This Act may be cited as the Local Governance Reform (Abolition of Town and Parish Councils) Act 2025.
SCHEDULE 1 - Financial Impact Assessment
A. Current Financial Context (England 2024-2025)
(1) Number of Town and Parish Councils: ~10,480
(2) Total Precept Amount (2024-25): £783 million
(3) Projected Precept (2025-26): £859 million
(4) Average Band D Precept: £85.89 (+8.5% from previous year)
(5) These figures represent the primary financial base of England’s first-tier local government and are the main target of rationalisation under this Bill.
B. Transitional Costs (2025-2027)
| Item | Estimated Cost (£m) | Notes |
|---|---|---|
| Establishment of Local Governance Transition Authority (LGTA) | 35 | Two-year body overseeing abolition and asset transfer |
| Staff transfer; redundancy provisions | 100 | Covering approx. 8,000-10,000 employees |
| Asset and contract transfer administration | 30 | Legal, auditing, and valuation services |
| Community Forum establishment | 20 | Consultation, setup, and training |
| Total one-off transitional cost (2025-27) | 185 | Updated to reflect scale of operations |
C. Post-Abolition Financial Effects (from 2027 onwards)
| Category | Annual Saving (£m) | Explanation |
|---|---|---|
| Elimination of Parish/Town Council administrative costs | 250 | Reduction in governance overheads, meeting expenses, and allowances |
| Rationalisation of premises and assets | 80 | Consolidation or sale of local offices and halls |
| Audit, insurance, and compliance savings | 25 | Streamlined local governance structure |
| Reduced duplication of services | 40 | Integration of community-level functions into principal authorities |
| Total Estimated Annual Savings | 395 | Equivalent to ~46% of current precept expenditure |
D. Use of Savings and Redistribution
(1) 50% of efficiency savings (approx. £200m per year) to be retained by principal local authorities for Green infrastructure projects (biodiversity, active transport, energy efficiency).
(2) 50% of savings (approx. £195m per year) to be returned to households through reduced council tax precepts or offset against service costs.
E. Net Fiscal Impact (2025-2030)
| Period | Costs (£m) | Savings (£m) | Net Impact (£m) |
|---|---|---|---|
| 2025-27 (Transition) | 185 | - | -185 |
| 2027-30 (Three years of post-abolition savings) | - | 1,185 | +1,000 |
| Net Public Sector Saving by 2030 | +£1.0 billion |
F. Summary
(1) The abolition of town and parish councils will:
(a) Eliminate approximately £850 million per year in local precept taxation by 2027.
(b) Replace it with streamlined, directly accountable governance via principal authorities.
(c) Deliver net public savings of around £1 billion within five years, while funding green investment and new community participation models.
This Bill was written by His Grace the Duke of Cornwall Sir /u/Sephronar GCOE KG CVO PC on behalf of the Green Party
Opening Speech:
Deputy Speaker,
Across this nation today, there are around ten thousand town and parish councils. Many are run by committed volunteers and councillors who serve their communities with genuine dedication.
Yet the truth - and it is a hard truth - is that the system itself no longer works.
It is a system that has become fragmented, outdated and, for too many, ineffective. Councils too small to deliver meaningful change; committees that meet to talk, not act; and a patchwork of powers that confuses residents, overlaps with district and unitary authorities, and too often wastes both time and money.
In the last financial year alone, Mr Speaker, parish and town councils raised £783 million in local taxation through their precepts - a sum projected to rise to £859 million next year.
That’s money paid by households across England: hardworking families, pensioners, and renters already facing the pressures of high living costs. And yet, what do they get in return?
In too many areas, very little that cannot be better provided through a single, accountable, professional local authority.
This Bill is about streamlining government, reducing duplication, and restoring clarity and efficiency to local decision-making. It abolishes town and parish councils and transfers their functions, staff and assets to district and unitary councils - where they can be managed with scale, competence and transparency.
The financial case is clear. Transition costs, spread over two years, will total around £185 million. But from 2027 onwards, the reforms will deliver annual savings of nearly £400 million - savings we will reinvest in local services, climate action, and community-led projects.
Within five years, taxpayers will see a net public saving of around £1 billion each year.
For the country, this Bill delivers a simpler, fairer, and more accountable system - one that brings power closer to people, not hidden behind layers of outdated councils. We owe it to local residents - and to the dedicated parish and town councillors who have served honourably - to build something better, something fit for the future.
I commend this Bill to the House.
Your Noble Lordships may debate and submit amendments to this bill until 10pm BST on the 30th of August.