The Great Reorganisation: NHS & Local Gov Boundaries Redrawn 2026

This is the second article in a series examining the boundary between local authority social care and the NHS. The first article established that this is a crossing between constitutional domains, not merely between organisations. This article examines what happens when both sides of that constitutional boundary are dissolved and recreated simultaneously.

England is conducting two parallel reorganisations of the public bodies responsible for health and social care. Both are the largest of their kind in a generation. Both are being implemented within the same twenty-four-month window. Both will dissolve existing organisations and create new ones. And between them, they will break and rebuild every formal agreement, every pooled budget, every partnership arrangement, and every boundary governance mechanism that currently exists between the NHS and local government.

On one side: local government reorganisation (LGR), replacing the two-tier system of county and district councils across 21 areas of England with new unitary authorities. Surrey leads — two new unitaries, East Surrey and West Surrey, replacing one county council and eleven districts, with elections in May 2026 and the new authorities going live on 1 April 2027. The remaining 20 areas follow: decisions during 2026, elections May 2027, vesting day 1 April 2028. Over 70 competing proposals have been submitted across the 21 areas. Nearly 20 million people — a third of England’s population — live in the areas being reorganised.

On the other side: ICB mergers and boundary changes, consolidating England’s 42 Integrated Care Boards into fewer, larger strategic commissioners. The first wave — 12 ICBs abolished, 6 new ICBs created, plus one boundary change — takes effect on 1 April 2026, covering London, East of England, and the South East. Decisions on further mergers follow in summer 2026, with additional changes from 1 April 2027. All ICBs must operate within a £19 per head running cost cap, having been required to cut running and programme costs by 50%.

The 10 Year Health Plan states that ICBs will “move to coterminosity with strategic authorities wherever feasibly possible.” The problem is that the strategic authorities do not yet exist. The ICB mergers are proceeding on footprints that may need to be revised once local government reorganisation decisions are made. NHS England’s own implementation guidance acknowledges that “in those areas where future local government boundaries aren’t yet known, new ICBs will progress on the understanding that they may be reviewed to allow alignment with any future strategic authorities.”

Both sides of the boundary are being rebuilt. Neither side knows the other’s final shape.

Section 75 & BCF: What Dissolves When Organisations Merge

When a county council is abolished and its functions are transferred to new unitary authorities, everything that was held between that council and its NHS partner must be unwound and recreated. Not transferred — recreated. Because the new organisation is a new legal entity, and the agreements were made with the old one.

Section 75 agreements under the NHS Act 2006 — the legal basis for pooled budgets between NHS bodies and local authorities — are contracts between named organisations. When one party ceases to exist, the agreement ceases to have a counterparty. General regulations provide a framework for continuity between existing and new councils, including staffing, disputes, and council tax harmonisation. But the regulations provide a framework, not continuity of governance arrangements. The new unitary authority inherits the predecessor’s statutory duties. It does not automatically inherit the predecessor’s partnerships, because partnerships are agreements between specific entities, negotiated in specific contexts, reflecting specific local arrangements.

The Better Care Fund is delivered through Section 75 agreements. Approximately £9 billion is committed for 2025-26 across England, pooling NHS and local authority funding for integrated services. Every BCF plan sits on a Section 75 agreement between an ICB and one or more local authorities through Health and Wellbeing Boards. When both the ICB and the local authority are dissolved and replaced with new entities, the BCF plan has no legal home. The funding envelope may transfer — the provisional local government finance settlement for 2026-27 sets funding envelopes for reorganised areas by combining predecessor allocations — but the governance arrangements, the agreed metrics, the local priorities, the joint commissioning decisions embedded in the plan must all be renegotiated by new organisations with new leadership structures, new democratic mandates, and new relationships.

Safeguarding Adults Boards are established under Section 43 of the Care Act 2014. Each local authority with adult social care responsibilities must establish a SAB, which must include the local authority, the ICB, and the chief officer of police. When a county council is abolished and its territory is divided between two or three new unitaries, the existing SAB is dissolved. New SABs must be created for each new authority. The accumulated learning, the established relationships between safeguarding leads, the local multi-agency protocols that took years to develop — these exist in people and in documents, not in legal structures. The structures are being demolished.

Joint commissioning arrangements, joint assessment protocols, local data sharing agreements, dispute resolution procedures agreed under the Care and Support (Provision of Health Services) Regulations 2014, integrated discharge pathways, joint workforce development programmes — all of these are agreements between specific organisations. When both organisations cease to exist, the agreements do not survive by operation of law. They must be rebuilt.

The Pattern from Previous NHS Reorganisations

This is not the first time the NHS has reorganised its commissioning structures. Health authorities became Primary Care Trusts (152 of them) in 2002. PCTs became Clinical Commissioning Groups (211 of them) in 2013. CCGs became Integrated Care Boards (42 of them) in 2022. ICBs are now being merged and their boundaries redrawn from 2026.

Each transition followed the same pattern. Corporate knowledge transferred through people, not systems. Where the same individuals moved from one organisation to the next, relationships and institutional memory survived. Where they did not — where staff took voluntary redundancy, retired, or moved to different roles — the knowledge of how local arrangements worked, who the key contacts were in partner organisations, what the history of specific cases and agreements was, disappeared.

The Health Foundation observed in 2025 that “since the creation of the purchaser-provider split in 1991, commissioners have been on an almost constant treadmill of reform and reorganisation” and that this has “undermined their ability to mature and operate effectively, resulting in loss of expertise.” The NHS Confederation’s survey of ICB leaders found that 95% were very or fairly concerned about the impact of cost reductions on their ability to deliver priorities, that leadership turnover had been substantial, and that “the energy and focus of senior leaders and their teams has been absorbed by delivering these efficiencies.”

What is different this time is that both sides of the LA-NHS boundary are reorganising simultaneously. Previous NHS reorganisations — PCT to CCG, CCG to ICB — disrupted the NHS side while leaving local government structures intact. The local authority remained a stable counterparty. The new NHS organisation could build its relationships with a known partner. The partner organisations’ systems, contacts, processes, and institutional memory were continuous.

In 2026-28, there is no stable counterparty. The new unitary authority is building new relationships with a new (or newly merged) ICB. Neither organisation has institutional memory of how the predecessor partnership worked, because neither organisation existed when the predecessor partnership was operating.

Coterminosity: Why ICB Boundary Alignment Creates the Problem

The stated goal of both reorganisations is alignment. The 10 Year Health Plan commits ICBs to be coterminous with strategic authorities — sharing the same boundaries — “wherever feasibly possible.” Local government reorganisation is creating unitary authorities of at least 500,000 population, replacing the current patchwork of counties, districts, and small unitaries. The ambition is clear: one strategic authority, one ICB, covering the same population.

The ambition is also a source of disruption. To achieve coterminosity, both sets of boundaries must change. And the decisions are being made by different bodies, on different timelines, with different criteria.

ICB mergers are led by NHS England and approved by ministers. The first wave takes effect 1 April 2026. Local government reorganisation decisions are made by the Secretary of State for Housing, Communities and Local Government. The Surrey decision is confirmed: two unitaries, vesting April 2027. For the remaining 20 areas, decisions are being made during 2026, with vesting in April 2028.

The sequencing is wrong. ICB mergers are happening before local government reorganisation decisions are finalised. ICBs are being created on footprints that may not align with the local government structures that emerge twelve to twenty-four months later. NHS England acknowledges this by noting that ICB boundaries “may be reviewed” once local authority structures are confirmed. That means a potential third reorganisation of some ICBs, within two years of their creation.

Consider Surrey. NHS Surrey Heartlands ICB and NHS Sussex ICB are merging to create a new Surrey and Sussex ICB from 1 April 2026, serving a population of over three million. Surrey is simultaneously reorganising into two unitary authorities from April 2027. The new ICB will go live six months before the new unitaries exist. It must establish partnership arrangements with the current county council and eleven district councils, knowing they will all cease to exist within a year. It must then rebuild those arrangements with the two new unitaries — organisations that have no staff, no systems, and no institutional memory at the point they are created.

The ICB’s implementation plan acknowledges that it will “work closely with all our existing local authority partners, recognising they are also going through change themselves.” This is a statement of intent, not a governance mechanism. It does not address what happens to Section 75 agreements, BCF plans, safeguarding partnerships, CHC dispute resolution procedures, data sharing agreements, joint commissioning arrangements, and integrated discharge pathways when both parties to every one of those agreements are simultaneously dissolved and recreated.

What Is Not Being Reorganised: Statutory Duties Without Infrastructure

The reorganisation dissolves organisations. It does not dissolve the statutory duties those organisations hold. The new unitary authority inherits the duty to assess and meet eligible adults’ care and support needs under the Care Act 2014. The new ICB inherits the duty to commission healthcare for its population. The boundary between health and social care — the constitutional line drawn by Coughlan and codified in Section 22 — remains exactly where it was.

The duties are continuous. The infrastructure for discharging those duties is not.

The people who need services during the transition period — the patients being discharged from hospital who need social care packages, the individuals being assessed for Continuing Healthcare, the adults at risk who require safeguarding, the older people whose domiciliary care is commissioned jointly — do not pause their needs while the organisations serving them are dissolved and rebuilt. The boundary crossing that was poorly governed before reorganisation does not become better governed during reorganisation. It becomes ungoverned.

This is the critical distinction. The reorganisation is not creating a boundary problem. It is exposing one that already exists, and removing the informal workarounds that made it tolerable. The relationships between specific individuals — the discharge coordinator who knows the social care contact at the county council, the CHC lead who has a working relationship with the local authority assessor, the safeguarding lead who sits on multi-agency meetings with colleagues they have worked with for years — these relationships are the actual governance mechanism at the LA-NHS boundary. They are not documented in any standard. They are not transferable to a new organisation. They are held by people who may or may not transition to the successor body.

When the organisations change, the people scatter, and the informal governance dissolves. What remains is the formal infrastructure — the statutory duties, the regulatory requirements, the Section 75 framework, the BCF planning process. And as the first article in this series established, the formal infrastructure governs the allocation of responsibility between the two domains. It does not govern the transfer of responsibility at the boundary between them.

Neighbourhood Health Cannot Survive the Reorganisation

The timing is particularly consequential because the neighbourhood health service — the 10 Year Health Plan’s centrepiece reform — depends entirely on the LA-NHS boundary working at the most granular level.

The 43 wave 1 test sites, launched in September 2025, are designed around integrated neighbourhood teams co-locating NHS, local authority, and voluntary sector services. The new GP contracts creating single neighbourhood providers (~50,000 population) and multi-neighbourhood providers (250,000+) are rolling out from 2026. Neighbourhood Health Centres — open at least 12 hours a day, 6 days a week, co-locating services from multiple organisations — are to be built in every community, starting where healthy life expectancy is lowest.

Every one of these initiatives requires governed crossings between NHS and local authority services. Every one requires the Section 75 arrangements, the data sharing agreements, the joint commissioning structures, and the integrated workforce arrangements that reorganisation is about to dissolve.

The neighbourhood health sites selected in September 2025 were selected based on existing local authority and ICB geographies. By April 2028, many of those geographies will no longer exist. The local authority partner that participated in the wave 1 bid may have been abolished. The ICB that submitted the joint plan may have been merged. The neighbourhood itself — defined by its relationship to the surrounding health and social care structures — may sit in a new unitary authority with a new ICB, new leadership, new priorities, and no memory of the pilot.

Co-location is not integration. Putting NHS and local authority services in the same building does not govern the crossing between them. It makes the crossing more frequent, more granular, more real-time — and therefore more dependent on governance infrastructure that does not yet exist and whose predecessor arrangements are being dismantled.

What Boundary Governance Infrastructure Survives Reorganisation

This is the question the reorganisation forces into the open. If the governance of the LA-NHS boundary depends on specific relationships between specific people in specific organisations, it cannot survive reorganisation. The relationships are dissolved with the organisations. If it depends on specific agreements between specific entities, it cannot survive reorganisation. The agreements expire with the parties.

Governance that survives reorganisation must be structural, not relational. It must exist in the infrastructure, not in the individuals.

At Inference Clinical, we describe this as the difference between procedural governance and infrastructural governance. Procedural governance — policies, protocols, memoranda of understanding, partnership agreements — is attached to organisations. When the organisation changes, the procedures must be rewritten. Infrastructural governance — the structural requirements that any boundary crossing must satisfy, regardless of which organisations are on either side — is attached to the crossing itself.

The Seven Flows are infrastructural. They define the necessary conditions for safe handover at any organisational boundary: Identity, Consent, Provenance, Clinical Intent, Alert and Responsibility, Service Routing, and Outcome. These conditions do not change when the organisations change. A patient being discharged from hospital to social care requires confirmed identity reconciliation, informed consent for the data crossing, preserved clinical reasoning, explicit transfer of responsibility, appropriate routing to a service with capacity and capability, and a closed outcome loop — whether the local authority is Surrey County Council or East Surrey Unitary Authority, whether the ICB is Surrey Heartlands or Surrey and Sussex.

Constitutional Binding — the principle that every action and data element must be explicitly bound to the constitutional authority under which it was created — is equally durable. The binding does not reference a specific ICB or a specific council. It references the constitutional domain: NHS clinical authority or Care Act statutory duty. When an NHS observation is used in a social care assessment, that is a constitutional boundary crossing regardless of which specific organisations are involved. The binding marks the crossing and constrains what can happen next.

MVRT — Minimum Viable Responsibility Transfer — asks five questions of every crossing: who is responsible now, for what, for how long, under what escalation conditions, and with what evidence? These questions do not depend on the identity of the organisations. They depend on the nature of the crossing.

Governance infrastructure that is defined by the crossing rather than the organisations on either side of it is the only kind that survives reorganisation intact. Everything else must be rebuilt. Inference Clinical’s Boundary Risk Assessment documents governance maturity at each crossing in a form that transfers to any successor organisation — producing a structured Boundary Risk Score that quantifies where the gaps are widest.

The First-Mover Advantage: Build Before the Reorganisation

There are two ways to approach the reorganisation.

The default is to wait for the new structures to settle, then rebuild partnership arrangements from scratch. This is what happened in 2002, 2013, and 2022. Each time, it took years for the new organisations to establish working relationships, negotiate new agreements, and rebuild the informal governance that makes the boundary tolerable. Each time, patients experienced the gap while the organisations found their feet.

The alternative is to build boundary governance infrastructure before the reorganisation — infrastructure that is attached to the crossing, not the organisations, and that can therefore be carried into any new structure without renegotiation.

An ICB that has mapped its LA-NHS crossings against the Seven Flows, assessed the maturity of governance at each boundary, and identified where MVRT requirements are not met has an asset that survives the merger. The assessment transfers because it describes the crossings, not the organisations. A new unitary authority that inherits a Seven Flows assessment of its predecessor’s NHS boundaries has a starting point that no previous reorganisation has provided — a documented understanding of what governance infrastructure exists at each crossing, what is missing, and what the risks are.

The organisations that build this before reorganisation carry it into the new structures. The organisations that wait start from zero, as they always have.

The Institute for Government’s research on previous rounds of LGR highlighted that reorganisation happens “at a time the sector is not in a resilient position” and that “after more than 15 years of financial strain, many local authorities are grappling with budgetary and staff pressures and limited strategic capacity.” The capacity to rebuild boundary governance from scratch, while simultaneously standing up a new organisation, delivering statutory services, and managing the transition of staff and systems, is not available. What is available — and what a Seven Flows assessment provides — is a structured understanding of what needs to exist at each crossing, documented in a form that any successor organisation can use.

Julian Bradder

Founder & CEO, Inference Clinical

Julian leads Inference Clinical’s work on governance infrastructure for clinical handover. He has 30 years’ experience in digital transformation across government, FTSE 100, and healthcare. Connect on LinkedIn