Based on a latest poll of municipal councils, UK councils are planning to sell community centers, sports centres, and shopping arcades as they bet on a fire sale of properties to stabilize finances.
Growing Fiscal Challenges Prompt Asset Sales
A coalition of councils representing second-tier cities in England stated that six out of ten of local authorities are intending to sell assets to meet the rising costs of social services for vulnerable individuals.
Local governments have previously faced criticism for disposing of public land and open spaces to support their finances, but they argue they must continue to generate essential revenue from asset sales or declare themselves bankrupt.
This coalition said that a significant number of councils seeking to generate funds from a quick sale of assets marked “a distinct shift from 2024, when the majority (six in ten) of municipal officials stated they would prioritise service redesigns and using financial reserves to manage increasing financial challenges.”
Specific Examples of Planned Disposals
One local authority in Kent said its property management strategy included the sale of a retail complex in a local town and a community venue in Rochester to raise £20m over the next half-decade.
- A local golf course and commercial properties owned in Worcestershire and Suffolk, which all provide rental income for the authority, will additionally be sold under the plan.
Local Levy Increases and Wider Financial Strains
This research of councils in the coalition, which covers several urban centers, further found that over seven in ten of councils will have to raise council taxes next spring to address the growing cost of essential services, higher levels of homelessness, and a persistent accommodation deficit.
The authority said it will press ahead with asset sales after steep rises in the cost of children services, special educational needs and disability (Send) provision, adult social care, and temporary accommodation.
“We are taking innovative approaches but some of these require time to deliver both better provisions and financial savings,” said Vince Maple.
He continued: “There are demographic pressures which will continue to add to the strains we have. As a local government body, we had a 91% cut in our revenue support grant from 2010-24, which is extremely difficult.”
Countrywide Patterns and Forecasts
A survey of county councils recently also found council budgets being stretched by the increasing figures of young people and older individuals needing Send support.
The County Councils Network projected that council deficits will reach £4.4bn a year by the end of the decade, as they grapple to cope with increased demand.
Ministers have delayed scheduled changes to the Send system until next year after a policy document outlining those changes was recently delayed.
Disadvantage and Financial Shortfalls
According to the most recent deprivation measures (IMD) covering English councils, several key cities members were included in the most disadvantaged in England.
- “Member cities like several major towns place in the top 30 across the country under the 2025 IMD measures,” noted the report.
“Although only a single urban area is in the ten most deprived for disadvantaged communities countrywide, urban areas are much more prone to be in the most deprived fifth of the nation. The data highlights the extent of difficulties confronting local leaders across major urban centers in the next twelve months,” the report concluded.
“Local government leaders have been clear about the necessity for a equitable and lasting funding system that accounts for and addresses the real levels of disadvantage and demand,” said a council leader.
“Lacking this, councils will persist to face difficult decisions around which essential services to fund, and which to reduce, to the detriment of their communities.”
A fifth of councils have reduced or weakened social care provision in the past 12 months, the study revealed.
