The Labour Party's proposals would 'pose a serious threat to local government', Mr Lang said.
He had no doubt an Edinburgh parliament's powers would include the strategic functions of local government. There would also be 'a serious risk that the present level of resources could be reduced', he said.
Scottish councils already spend 33% more a head than their English counterparts. 'How secure would that be as a new parliament sought to embark on expensive new ambitions of its own?' he said.
Reorganisation heralded 'a fresh start' for councils, he said.
The move to a single-tier structure, coupled with the decentralisation of services, should bridge the gap between councils and the communities they serve.
By 1998, Mr Lang said, he expected to see decentralisation proposals in place and 'some of the benefits to which I have alluded coming through, particularly in the form of a reduction in the them-and-us mentality'.
Mr Lang highlighted the changing role of council members. They would be unable to perpetuate the current practice in many parts of the country.
'By that I mean simply to administer in detail through layers of committees,' he said. Instead their role would be to determine strategy, represent their areas and monitor service delivery.
Denying he was making a plea for 'wholesale privatisation', Mr Lang said unitaries would also look more realistically than many existing councils at working with, or through, other agents.
They had to be more imaginative in seeking funding sources for their capital requirements - notably through the use of the private finance initiative.
Mr Lang hoped the new structure would make a new departure between local and central government. 'The opportunity is there and is one that both sides must grasp,' he said.
'I, for my part, would certainly wish to respond to a responsible approach by local councillors and local government to the new structure.'