It is the role of directly elected local Police and Crime Commissioners to propose changes to local policing, not the Home Office. Any request from police forces to voluntarily merge would be considered where it is supported by a robust business case and has local consent.
It is not necessary for police forces to merge in order to become more efficient. Existing legislation places a strong duty on Chief Constables and Police and Crime Commissioners to collaborate in the interests of efficiency and effectiveness. Many are demonstrating that savings can be generated through collaboration without sacrificing local accountability and identity.