In 2006 following trials and pilot schemes the DfT issued its landmark Guidance for Setting Local Speed Limits.
http://www.dft.gov.uk/publications/local-speed-limits-guidance/
Speed Limit Guidance pdf
It describes many differing conditions and situations within its 32 pages of Guidance and 16 pages of Appendices. It includes ‘quick start’ guides for urban and rural areas. However there is no substitute for using the body of the Guidance. It mixes background discussion and reference to previous Guidance while showing the current Guidance to be used. Not everywhere needs a speed limit – quiet country lanes or idyllic villages where traffic is inherently well behaved.

Once appropriate guidelines have been selected, a final check is that the proposed limit along its length is aimed no lower than mean traffic speeds

The aim should be to align the local speed limit so that the original mean speed driven on the road is at or below the new posted speed limit for that road.

If at any time one Guideline is found to be in conflict with another, initial assumptions should be reviewed, choice of Guidelines updated until there is no conflict.

The first priority where a particular accident type is over-represented is to investigate resolution using landscaping, engineering or signage etc.

A speed limit should not be used for an isolated junction or bend 

Indeed, if a speed limit is set in isolation, or is unrealistically low, it is likely to be ineffective and lead to disrespect for the speed limit. As well as requiring significant, and avoidable, enforcement costs, this may also result in substantial numbers of drivers continuing to travel at unacceptable speeds, thus increasing the risk of collisions and injuries.