According to a latest poll of local authorities, English councils are planning to sell social clubs, sports centres, and shopping arcades as they rely on a fire sale of assets to stabilize finances.
Increasing Financial Pressures Drive Asset Sales
A coalition of councils for second-tier cities in the UK reported that 60% of local authorities are intending to sell assets to meet the escalating costs of adult and children’s social care.
Councils have in the past faced criticism for selling playing fields and land to support their budgets, but they contend they must proceed to generate essential revenue from property disposals or face insolvency.
This coalition said that a high proportion of authorities attempting to generate funds from a quick sale of holdings marked “a distinct shift from 2024, when the majority (six in ten) of local leaders said they would focus on service redesigns and utilising financial reserves to weather increasing fiscal pressures.”
Detailed Examples of Planned Disposals
One local authority in southeast England said its asset disposal plan included the disposal of a retail complex in a local town and a community venue in Rochester to raise 20 million pounds over the next half-decade.
- Gillingham golf club and business parks owned in Worcestershire and Suffolk, which all provide rental income for the authority, will also be sold under the strategy.
Local Levy Increases and Wider Fiscal Pressures
This research of councils in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of authorities will have to increase local levies next April to cover the rising cost of core provisions, higher levels of homelessness, and a persistent housing shortage.
Medway council explained it will press ahead with property disposals after sharp increases in the cost of children services, support for vulnerable learners, elderly and disability services, and short-term housing.
“We are adopting innovative approaches but certain measures require time to achieve both better provisions and cost efficiency,” stated Vince Maple.
He continued: “We face population challenges which will persist to increase the strains we have. As a unitary authority, we had a drastic reduction in our central funding from 2010-24, which is extremely difficult.”
National Trends and Forecasts
A survey of county councils this week also found council budgets being strained by the growing number of children and older individuals requiring special educational assistance.
A network of councils said that local shortfalls will reach £4.4bn a year by the end of the decade, as they grapple to cope with rising needs.
Ministers have put off scheduled changes to the special educational needs framework until the coming year after a white paper outlining those changes was recently delayed.
Deprivation and Funding Shortfalls
According to the latest deprivation measures (IMD) for UK local authorities, several participating urban areas were included in the most disadvantaged in the country.
- “Participating urban centers like several major towns place in the most deprived 30 across the country under the 2025 deprivation indices,” said the study.
“While only one key city is in the ten most deprived for deprived neighbourhoods nationally, cities are far more likely to be in the worst-off 20% of the nation. The data underscores the scale of challenges confronting local leaders across key cities in the coming year,” the analysis added.
“Council officials have been explicit about the necessity for a equitable and lasting financial structure that reflects and addresses the real levels of disadvantage and demand,” stated Michael Mordey.
“Lacking this, local authorities will persist to face impossible choices around which essential services to allocate spend to, and which to cut, to the disadvantage of their communities.”
A fifth of local authorities have reduced or weakened care services in the last year, the survey revealed.
