According to a latest study of municipal councils, English councils are planning to sell social clubs, athletic facilities, and retail spaces as they rely on a fire sale of properties to balance the books.
Growing Financial Pressures Drive Asset Sales
The Key Cities Group for second-tier cities in the UK reported that six out of ten of councils are planning to sell assets to cover the escalating costs of adult and children’s social care.
Councils have in the past faced criticism for selling playing fields and open spaces to support their finances, but they argue they must proceed to generate essential revenue from property disposals or face insolvency.
The group said that a significant number of authorities attempting to raise money from a quick sale of holdings marked “a clear change from 2024, when the majority (six in ten) of municipal officials stated they would prioritise restructuring services and utilising financial reserves to manage growing fiscal pressures.”
Detailed Examples of Planned Sales
Medway Council in Kent said its asset disposal plan included the disposal of a retail complex in Rainham and a community venue in another town to raise £20m over five years.
- A local golf course and business parks held in Worcestershire and Suffolk, which all provide rental income for Medway council, will also be sold under the plan.
Council Tax Rises and Broader Fiscal Strains
The survey of local authorities in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of authorities will need to raise local levies next April to cover the rising cost of core provisions, higher levels of homelessness, and a persistent housing shortage.
The authority explained it will proceed with property disposals after steep rises in the cost of youth support, special educational needs and disability (Send) provision, adult social care, and short-term housing.
“We are taking creative strategies but certain measures require time to deliver both better provisions and financial savings,” said Vince Maple.
He added: “There are population challenges which will continue to add to the pressures we have. As a unitary authority, we had a drastic reduction in our central funding from over the past decade, which is very challenging.”
National Patterns and Projections
Research of regional authorities this week further found council budgets being stretched by the growing number of children and older individuals requiring Send support.
The County Councils Network said that local shortfalls will reach 4.4 billion pounds a year by 2029, as they struggle to manage increased demand.
Government officials have put off scheduled changes to the Send system until next year after a white paper outlining those reforms has been postponed.
Deprivation and Financial Gaps
According to the most recent deprivation measures (IMD) covering English councils, several participating urban areas were among the most disadvantaged in the country.
- “Member cities like several major towns rank in the top 30 nationally under the latest IMD measures,” noted the study.
“While only one key city is in the ten most deprived for disadvantaged communities countrywide, cities are far more likely to be in the most deprived fifth of the nation. The data underscores the scale of challenges facing local leaders across major urban centers in the next twelve months,” the analysis added.
“Council officials have been explicit about the need for a equitable and lasting funding system that reflects and addresses the actual extent of deprivation and need,” said Michael Mordey.
“Lacking this, local authorities will continue to face difficult decisions around which vital provisions to fund, and which to cut, to the detriment of their communities.”
A fifth of local authorities have reduced or weakened care services in the past 12 months, the study revealed.
