Based on a latest poll of municipal councils, English councils are preparing to sell social clubs, sports centres, and shopping arcades as they rely on a fire sale of properties to balance the books.
Increasing Fiscal Pressures Prompt Asset Sales
A coalition of councils for second-tier cities in the UK reported that 60% of councils are planning to sell assets to cover the rising costs of social services for vulnerable individuals.
Councils have in the past faced criticism for selling playing fields and open spaces to shore up their budgets, but they contend they must proceed to generate essential revenue from property disposals or declare themselves bankrupt.
The group said that a significant number of authorities attempting to generate funds from a fire sale of assets represented “a clear change from 2024, when the majority (six in ten) of local leaders said they would focus on restructuring services and using savings to weather growing fiscal pressures.”
Detailed Examples of Proposed Sales
One local authority in southeast England announced its asset disposal plan included the sale of a shopping centre in a local town and a community venue in Rochester to raise 20 million pounds over five years.
- Gillingham golf club and business parks owned in two English counties, which all generate rent for the authority, will also be sold under the plan.
Local Levy Increases and Wider Fiscal Pressures
This research of local authorities in the key cities group, which covers Sunderland, Southampton, Gloucester and Salford, also found that over seven in ten of councils will have to increase local levies next spring to cover the growing cost of essential services, higher levels of housing insecurity, and a longstanding housing shortage.
The authority explained it will proceed with asset sales after sharp increases in the cost of children services, special educational needs and disability (Send) provision, elderly and disability services, and temporary accommodation.
“We are adopting creative strategies but certain measures take time to deliver both better provisions and cost efficiency,” stated a council leader.
He added: “There are demographic pressures which will persist to add to the pressures we have. As a local government body, we had a 91% cut in our revenue support grant from over the past decade, which is very challenging.”
Countrywide Patterns and Forecasts
A survey of county councils this week also found local finances being strained by the increasing figures of young people and older individuals needing special educational assistance.
The County Councils Network projected that council deficits will hit £4.4bn a year by 2029, as they struggle to manage increased demand.
Ministers have put off planned reforms to the Send system until next year after a white paper outlining those changes was recently delayed.
Disadvantage and Financial Gaps
According to the most recent indices of deprivation (the Index of Multiple Deprivation) for UK local authorities, many key cities members 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 IMD measures,” noted the study.
“While only one key city is in the top 10 for deprived neighbourhoods countrywide, urban areas are far more likely to be in the most deprived fifth of the nation. The data highlights the scale of difficulties confronting local leaders across key cities 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 actual extent of deprivation and need,” said a council leader.
“Without this, councils will persist to face difficult decisions around which vital provisions to fund, and which to cut, to the disadvantage of their communities.”
One in five of councils have reduced or weakened social care provision in the past 12 months, the study revealed.
