Labour’s manifesto promised to “deepen” and “widen” devolution, with more areas expected to take on the mayoral combined authority (CA) model like that headed by Sadiq Khanin Greater London.
Local elections are held every year in May – but Mr McMahon told LBC some councils “essentially won’t exist” if they make a request for reorganisation under the devolution proposals.
“At the moment, the assumption is that elections are going ahead,” he said.
“However, it’s usual in a process of reorganisation that when a council makes a request for reorganisation – that if there are elections taking place to a council that essentially won’t exist within the term of those elections – then you hold off the elections and you elect to a shadow body, and the shadow body basically is a form of the new councils that will follow.”
Some local authorities have already requested reorganisation, he added, saying there will be a statutory consultation before any changes are made.
Asked if some local authorities would be closed or merged Mr McMahon said: “That’s the nature of reorganisation.”
There are 12 areas of England under the CA model, headed by regional metro mayors. These mayors, including Andy Burnham in Greater Manchester, have more powers than leaders or mayors of local councils.
Mr McMahon, the minister for local government, told Sky News he wants the “whole country to realise the benefit of what that mayoral combined authority can bring”.
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Speaking later to Good Morning Britain, he said merging councils could bring £2bn in efficiency savings.
He said there are only 21 counties still with a two-tier system of local government – meaning there is a district and a county council – and lots of people “don’t know which council to go to”.
“This is about simplifying the system so that the accountability is strong, but it’s not to diminish the work that district councils and county councils have done in the past,” he said.
Mr McMahon will set out more details of the plan this afternoon in parliament.
It comes on the same day as a speech by Deputy Prime Minister Angela Rayner, who will vow to push power out of Whitehall and into the hands of people with “skin in the game” across a range of policy areas including housing.
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‘House building target is achievable’
One of the central missions of the new Labour government is to build 1.5 million homes by the end of this parliament – with local councils last week told to come up with “immediate, mandatory” housing targets as part of the plan.
Ms Rayner, who is also the housing secretary, is expected to say that bringing together “strategic authorities” would help “to avoid duplication and give our cities and regions a bigger voice” in order to get spades in the ground.
However, the Local Government Association – the membership body for authorities in England and Wales – warned devolution was “not an end in itself” and “cannot distract from the severe funding pressures that are pushing local services to the brink”.
The government’s full devolution proposals will be set out in a White Paper, due to be published in parliament later today.