Based on a recent study of municipal councils, English councils are preparing to offload social clubs, athletic facilities, and retail spaces as they bet on a fire sale of assets to stabilize finances.
Growing Fiscal Pressures Prompt Asset Sales
The Key Cities Group for major urban areas in England stated that 60% of local authorities are intending to dispose of properties to meet the escalating costs of adult and children’s social care.
Local governments have in the past come under fire for disposing of public land and open spaces to shore up their finances, but they argue they must proceed to generate essential revenue from property disposals or face insolvency.
The group said that a high proportion of councils attempting to raise money from a quick sale of assets represented “a distinct shift from 2024, when the majority (60%) of municipal officials stated they would prioritise service redesigns and utilising savings to manage increasing financial challenges.”
Specific Examples of Planned Disposals
One local authority in Kent announced its asset disposal plan featured the disposal of a shopping centre in a local town and a community venue in another town to raise 20 million pounds over five years.
- A local golf course and business parks owned in two English counties, which all provide rental income for Medway council, will also be disposed of under the plan.
Local Levy Rises and Broader 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 need to raise council taxes next April to address the rising cost of core provisions, higher levels of housing insecurity, and a persistent accommodation deficit.
The authority explained it will proceed with asset sales after steep rises in the cost of children services, special educational needs and disability (Send) provision, elderly and disability services, and short-term housing.
“We are adopting innovative approaches but certain measures take time to deliver both improved services and financial savings,” stated a council leader.
He added: “There are population challenges which will continue to increase 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.”
National Patterns and Forecasts
Research of regional authorities this week also found council budgets being strained by the growing number of young people and older individuals needing Send support.
The County Councils Network projected that council deficits will hit £4.4bn a year by the end of the decade, as they grapple to cope with increased demand.
Government officials have put off scheduled changes to the special educational needs framework until next year after a white paper outlining those changes was recently delayed.
Disadvantage and Funding Gaps
According to the most recent deprivation measures (the Index of Multiple Deprivation) for UK local authorities, several participating urban areas were among the most deprived in England.
- “Participating urban centers like several major towns place in the top 30 nationally under the 2025 IMD measures,” said the study.
“Although only one key city is in the ten most deprived for deprived neighbourhoods countrywide, cities are far more likely to be in the most deprived fifth of the nation. The data underscores the extent of difficulties facing municipal officials across key cities in the next twelve months,” the report added.
“Local government leaders have been explicit about the need for a equitable and lasting funding system that reflects and addresses the real levels of deprivation and need,” stated a council leader.
“Lacking this, local authorities will continue to face impossible choices around which vital provisions to allocate spend to, and which to cut, to the disadvantage of their residents.”
A fifth of local authorities have cut or compromised care services in the last year, the survey found.
