Plans for three new regional assemblies have been put forward to the government.
The North-East is one of the regions set for an overhaul
The BBC's Nick Higham looks at what impact the new structures will have on local authorities.
Q: What are the proposed changes?
A: The government is proposing to introduce a new tier of devolved government in England, following the establishment of the devolved Parliament in Scotland and the Assembly in Wales.
London already has the Greater London Authority.
Now the government is pressing ahead with plans for devolved assemblies in three other regions, where enthusiasm for the idea seems to be greatest: the North East, the North West and Yorkshire-and-Humber.
Each assembly would have between 25 and 35 members, elected by a form of proportional representation.
People in the first three regions will be asked to vote in referendums on whether or not they want an assembly.
The first referendum is likely to be held this autumn, probably in the North East, where a BBC poll in 2002 found 72 per cent of the population were in favour.
Q: What would the new assemblies be responsible for?
A: Under the government's original proposals, spelt out in a White Paper published in 2002, the new assemblies would have significant powers in four main areas.
The first is economic development, where the assemblies will appoint the chairmen and boards of the existing Regional Development Agencies and supply the RDAs' funds.
The second is planning, where the assemblies will take over from the government the job of drawing up "spatial strategies" for their regions.
The third is housing, where the assemblies will be responsible for the allocation of resources between council housing programmes and housing association projects.
The fourth is culture and tourism, where the assemblies will fund regional "cultural consortiums" as well as the regional tourist boards and local English Heritage sites.
Since the original proposals were published enthusiasts for assemblies have lobbied for them to have greater powers, in areas where their responsibilities were originally purely advisory.
Transport is one area in which the assemblies' powers may be increased.
Q: What are the arguments in favour of assemblies?
A: The main argument is that central government is too remote from many regions and that decisions taken in Whitehall and Westminster are not always in the best interests of a region like the North East.
Creating an assembly with strategic powers is meant to produce policies more closely tailored to regional needs.
Supporters of the idea argue that decision-making would be speeded up.
Q: What are the arguments against?
A: Critics - including many businesses - say the assemblies risk becoming little more than expensive talking-shops run by second-rate local politicians, and will be no quicker at taking decisions than central government.
Q: Will they cost more money?
A: The government says the money for the assemblies' budgets will come primarily from existing central government funds.
This money is spent at the moment by quangos and agencies like the RDAs or English Heritage.
The assemblies will also be able to borrow money for capital expenditure.
But extra government cash will be available for regions whose assemblies "achieve or exceed the targets agreed with central government".
And (as in London) the assemblies will also be able to raise extra cash by adding a precept to existing local authorities' council tax bills.
This has led critics of the proposals to claim the scheme will make government more expensive overall.
Two years ago the government estimated the budget of a North East assembly would be around £350m, although it would also have some say over the way a further £500m is spent.
Q: What are the implications for existing local authorities?
A: Partly to meet the objection that the assemblies might mean an additional (and costly) layer of government bureaucracy, the government has decided to abolish the remaining two-tier councils in regions which may get assemblies and replace them with "unitary" authorities (some areas, like Greater Manchester or Tyneside, already have unitary authorities).
The Electoral Commission's boundary committee has published proposals offering two options in each region, which voters will be invited to choose between at the same time as they vote in the referendums on whether to have an assembly.
Essentially the first option would involve scrapping all the remaining district councils and replacing them with six county councils in Cumbria, Lancashire, Cheshire, Northumberland, Durham and North Yorkshire.
The second option would involve scrapping the counties and merging districts to create 16 authorities.
The most controversial proposal involves Lancashire and Cumbria, where under one option Lancaster City from Lancashire would be combined with South Lakeland and Barrow-in-Furness from Cumbria to create a unitary authority straddling the old county division.