I think devolvement is the term for what he wants to do in the first place; take central government and allow certain aspects to be ruled locally. It's certainly what we call it in N. Ireland. (although quite what they rule locally remains a mystery to the inhabitants, it's certainly not an education system. Or health. Or roads.... *small rant over*)
In terms of the change; he takes the position to stop the previous structures falling and a power struggle emerging, so it is a case of maintaining the status quo. At first. But over the space of the years, he wants to move it to dissolution. But you're quite right, it's not just a case of poof, there you go, enjoy yourselves.
So, in terms of how to start the process is devolvement the right way to go: the gradual handing over of plenary powers? Because he is going to start the process, I just don't want an absolute hash of it made.
Actually, having it sort of half and half and quite messy at the 10 year stage would be the best outcome for the story.
, he's quite happy to do himself out of a job... this isn't all altruisic...)