ßÙßÇÂþ»’s Contracts During Local Government Reform (LGR)
ßÙßÇÂþ» (SCC) holds over 20,000 contracts, many of which underpin critical services. As SCC transitions into successor unitary councils, these contracts will need to be either transferred, novated, or hosted to ensure continuity of service and legal compliance post-Vesting Day (April 2027).
Main Options for Handling Contracts
There are three primary options:
- Transfer: Moving the contract to a single successor council.
- Hosting: One successor council delivers services on behalf of others via an Inter Authority Agreement (IAA).
- Novation: The contract is legally reassigned to one or more successor councils.
Criteria for Selecting Contract Handling Options
Decisions will be based on:
- Service alignment with successor councils
- Contract complexity and value
- Impact on vulnerable residents
- Market conditions
- Legal and commercial feasibility
- Data
- IT systems and architecture
Supplier Agreement Requirements
Not all changes require supplier consent. Under the 2008 Regulations, some transfers can occur automatically without supplier consent (Transfer and some hosting arrangements). However, novation will require supplier agreement and may involve renegotiation.
Importance of Section 16 Agreements
A Section 16 agreement under the 2008 Regulations allows for the automatic transfer of contracts, assets, and liabilities to successor councils. It is a key legal mechanism for ensuring continuity without needing to renegotiate every contract individually.
Further Information
The Government has now confirmed plans for local government reorganisation in ßÙßÇÂþ». From April 2027, the current 12 councils will be replaced by two new unitary authorities: East ßÙßÇÂþ» and West ßÙßÇÂþ».
The new councils will have responsibility for delivering all services in one area including waste collection, planning, adult social care, children’s services, highways and more. This change is intended to simplify service delivery and improve efficiency across the county.
Elections to the new authorities will take place in May 2026. These newly elected councillors will oversee the transition to the new structure and the council’s portfolio of contracts. The new councils will officially take responsibility in April 2027. In the meantime, all 12 existing councils will continue to operate and deliver services as usual.
We understand that you may have questions about how this will affect your current ßÙßÇÂþ» contract or working relationships.
Please be assured that nothing is changing at this stage. Over the months ahead, we’re committed to ensuring a smooth and collaborative transition to the new authorities, and we’ll keep you informed and involved as plan develop.
If you have any general questions about the local government reorganisation and devolution process, you can email devolutionandlgr@surreycc.gov.uk.
For enquiries regarding your specific contract, please contact your relationship or contract manager. However, please bear in mind they will only be able to supply limited information at this stage, given the recent announcement.
For all forthcoming tendering opportunities, please continue to use .