Based on a recent poll of local authorities, English councils are planning to offload community centers, sports centres, and shopping arcades as they bet on a fire sale of assets to stabilize finances.
Growing Fiscal Pressures Drive Asset Sales
The Key Cities Group for major urban areas in the UK reported that six out of ten of local authorities are planning to dispose of properties to cover the rising costs of adult and children’s social care.
Local governments have in the past faced criticism for disposing of public land and open spaces to support their budgets, but they argue they must proceed to raise vital cash from property disposals or face insolvency.
The group noted that a significant number of councils seeking to raise money from a quick sale of holdings represented “a clear change from 2024, when the majority (six in ten) of municipal officials stated they would focus on service redesigns and using financial reserves to weather increasing fiscal pressures.”
Specific Examples of Proposed Disposals
Medway Council in Kent announced its asset disposal plan included the sale of a shopping centre in a local town and a community venue in another town 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 Medway council, will additionally be disposed of under the plan.
Council Tax Increases and Wider Financial Strains
This research of local authorities in the key cities group, which includes several urban centers, further found that more than 70% of councils will have to raise council taxes next spring to address the growing cost of core provisions, increased rates of homelessness, and a persistent accommodation deficit.
The authority explained it will press ahead with property disposals after steep rises in the cost of youth support, special educational needs and disability (Send) provision, elderly and disability services, and temporary accommodation.
“We are taking innovative approaches but some of these require time to achieve both improved services and financial savings,” said Vince Maple.
He added: “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 very challenging.”
Countrywide Patterns and Forecasts
A survey of regional authorities recently also found local finances being stretched by the increasing figures of children and adults needing special educational assistance.
A network of councils said that council deficits will hit £4.4bn a year by 2029, as they struggle to manage rising needs.
Government officials have delayed scheduled changes to the special educational needs framework until next year after a policy document setting out those reforms was recently delayed.
Deprivation and Financial Shortfalls
According to the latest indices of deprivation (IMD) covering English councils, many participating urban areas were among the most disadvantaged in England.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the most deprived 30 across the country under the latest deprivation indices,” noted the report.
“While only one key city is among the top 10 for deprived neighbourhoods nationally, urban areas are far more likely to be in the most deprived fifth of England. The figures underscores the scale of difficulties confronting municipal officials 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 financial structure that accounts for and addresses the actual extent of disadvantage and demand,” said a council leader.
“Without this, councils will continue to face impossible choices around which essential services to fund, and which to cut, to the detriment of their communities.”
One in five of local authorities have reduced or weakened social care provision in the last year, the study revealed.
