According to a new survey of local authorities, UK councils are planning to sell social clubs, sports centres, and shopping arcades as they bet on a fire sale of assets to balance the books.
Growing Financial Challenges Prompt Asset Sales
The Key Cities Group for second-tier cities in England stated that six out of ten of councils are intending to dispose of properties to cover the rising costs of adult and children’s social care.
Councils have previously come under fire for selling playing fields and open spaces to support their finances, but they contend they must continue to generate essential revenue from property disposals or declare themselves bankrupt.
This coalition noted that a high proportion of authorities attempting to generate funds from a quick sale of holdings represented “a clear change from 2024, when the largest share (six in ten) of local leaders stated they would prioritise restructuring services and utilising savings to weather increasing financial challenges.”
Detailed Examples of Planned 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 Rochester to generate £20m over the next half-decade.
- A local golf course and commercial properties held in Worcestershire and Suffolk, which all provide rental income for the authority, will also be disposed of under the plan.
Council Tax Rises and Wider Financial Pressures
This research of local authorities in the key cities group, which covers several urban centers, further found that over seven in ten of councils will need to raise local levies next April to address the growing cost of essential services, higher levels of housing insecurity, and a longstanding housing shortage.
Medway council said it will press ahead with asset sales after sharp increases in the cost of youth support, support for vulnerable learners, adult social care, and temporary accommodation.
“We are adopting creative strategies but some of these require time to achieve both improved services and financial savings,” stated a council leader.
He continued: “We face demographic pressures which will continue to add to the pressures we have. As a local government body, we had a drastic reduction in our central funding from 2010-24, which is extremely difficult.”
Countrywide Trends and Forecasts
A survey of regional authorities recently further found local finances being strained by the growing number of young people and adults needing Send support.
A network of councils projected that local shortfalls will hit 4.4 billion pounds a year by 2029, as they grapple to cope with rising needs.
Ministers have delayed scheduled changes to the Send system until next year after a white paper setting out those reforms was recently delayed.
Disadvantage and Financial Shortfalls
Based on the latest deprivation measures (IMD) for UK local authorities, many participating urban areas were among the most disadvantaged in England.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the top 30 nationally under the latest IMD measures,” said the study.
“While only a single urban area is among the top 10 for deprived neighbourhoods nationally, cities are much more prone to be in the worst-off 20% of the nation. The figures highlights the scale of challenges facing municipal officials across key cities in the next twelve months,” the report concluded.
“Council officials have been explicit about the necessity for a fair and sustainable financial structure that reflects and responds to the actual extent of deprivation and need,” stated Michael Mordey.
“Lacking this, local authorities will continue to face difficult decisions around which vital provisions to allocate spend to, and which to cut, to the detriment of their residents.”
One in five of councils have reduced or weakened social care provision in the last year, the survey found.
