The number of local authorities in Wales should be halved to create a 'radical shift' in the public sector, according to the publication of the Williams Review.
The review, published by the Commission on Public Service Governance and Delivery, recommends that the current 22 local authorities are merged into a minimum of 12 local authorities.
Chair of the Commission, Sir Paul Williams, said: 'Radical change is needed for public services to survive in a viable and sustainable form. We cannot deny or ignore current and future challenges; instead, we need a public sector which can rise to meet them. We need a radical shift, which will mean fundamental changes to structures, roles and programmes across the Welsh public sector.
'We all need to embrace the need for change, and make it happen as quickly and effectively as possible. It is far better to invest in reform now, before it is too late, and to create world-class public services and a public sector of which we can all be proud.
'The problems we have found are hard wired into the systems, processes and values of the public sector as it stands. They are interdependent and mutually reinforcing - and they demand equally interlinked solutions. We hope our recommendations will be implemented as a whole - in isolation they will not provide the solution to the problems faced by public services in Wales.'
The Welsh Local Government Association (WLGA) said the options presented in the review should be carefully considered within the 'widest context' and decisions on the future of public services should not be taken lightly. It warned that the upfront cost of large scale change should also be identified, and local communities should be given time to have their say on the proposals.
The Commission was set up in April 2013 by the First Minister.