Based on a latest survey of municipal councils, 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 Fiscal Pressures Drive Asset Sales
The Key Cities Group for second-tier cities in the UK stated that 60% of local authorities are planning to dispose of properties to meet the escalating costs of social services for vulnerable individuals.
Local governments have previously faced criticism for disposing of playing fields and open spaces to shore up their finances, but they contend they must proceed to generate essential revenue from asset sales or declare themselves bankrupt.
The group noted that a high proportion of authorities seeking to raise money from a fire sale of assets represented “a distinct shift from 2024, when the majority (60%) of municipal officials said they would focus on restructuring services and utilising savings to manage increasing financial challenges.”
Detailed Cases of Proposed Disposals
One local authority in Kent announced its asset disposal plan featured the sale of a shopping centre in Rainham and a community venue in another town to generate £20m over five years.
- Gillingham golf club and business parks held in two English counties, which all provide rental income for the authority, will additionally be sold under the strategy.
Local Levy Increases and Broader Financial Pressures
The survey of local authorities in the key cities group, which covers Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of councils will need to raise local levies next April to cover the growing cost of core provisions, higher levels of homelessness, and a persistent housing shortage.
Medway council explained it will press ahead with property disposals after steep rises in the cost of children services, support for vulnerable learners, elderly and disability services, and temporary accommodation.
“We are adopting creative strategies but some of these require time to achieve both better provisions and cost efficiency,” stated Vince Maple.
He continued: “We face demographic pressures which will persist to increase the strains we have. As a local government body, we had a 91% cut in our central funding from over the past decade, which is very challenging.”
Countrywide Trends and Projections
A survey of county councils this week also found local finances being stretched by the growing number of children and older individuals requiring Send support.
The County Councils Network said that council deficits will hit 4.4 billion pounds a year by 2029, as they grapple to cope with rising needs.
Government officials have delayed planned reforms to the special educational needs framework until next year after a policy document setting out those changes was recently delayed.
Deprivation and Funding Shortfalls
According to the most recent deprivation measures (IMD) covering UK local authorities, several participating urban areas were included in the most deprived in the country.
- “Participating urban centers like several major towns place in the most deprived 30 nationally under the 2025 deprivation indices,” said the study.
“Although only a single urban area is in the ten most deprived for disadvantaged communities 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 major urban centers in the next twelve months,” the report concluded.
“Council officials have been explicit about the need for a equitable and lasting funding system that reflects and responds to the real levels of disadvantage and need,” said a council leader.
“Lacking this, local authorities will continue to face difficult decisions around which vital provisions to allocate spend to, and which to cut, to the disadvantage of their communities.”
One in five of councils have reduced or weakened care services in the last year, the survey found.
