Based on a new survey of local authorities, English councils are planning to sell community centers, sports centres, and shopping arcades as they rely on a rapid disposal of assets to balance the books.
Increasing Fiscal Challenges Drive Asset Sales
A coalition of councils representing second-tier cities in the UK stated that six out of ten of local authorities are planning to dispose of properties to cover the rising costs of adult and children’s social care.
Local governments have previously come under fire for disposing of public land and land to support 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 seeking to generate funds from a fire sale of holdings marked “a distinct shift from 2024, when the majority (60%) of local leaders stated they would focus on restructuring services and using financial reserves to manage growing fiscal pressures.”
Specific Cases of Proposed Disposals
One local authority in southeast England said its asset disposal plan included the sale of a shopping centre in Rainham and a social club in another town to raise 20 million pounds over the next half-decade.
- A local golf course and commercial properties owned in two English counties, which all generate rent for the authority, will additionally be sold under the strategy.
Local Levy Increases and Wider Fiscal Strains
This research of councils in the coalition, which includes several urban centers, also found that more than 70% of councils will have to raise local levies next April to address the growing cost of essential services, higher levels of homelessness, and a longstanding housing shortage.
Medway council said it will proceed with asset sales after steep rises in the cost of youth support, special educational needs and disability (Send) provision, elderly and disability services, and short-term housing.
“We are taking innovative approaches but some of these take time to deliver both better provisions and cost efficiency,” said a council leader.
He added: “There are population challenges which will continue to increase the pressures we have. As a local government body, we had a drastic reduction in our revenue support grant from 2010-24, which is very challenging.”
National Trends and Forecasts
Research of county councils this week further found local finances being strained by the increasing figures of children and adults requiring Send support.
The County Councils Network projected that local shortfalls will reach £4.4bn a year by 2029, as they grapple to cope with increased demand.
Ministers have put off scheduled changes to the special educational needs framework until next year after a policy document setting out those reforms was recently delayed.
Disadvantage and Funding Shortfalls
According to the most recent indices of deprivation (IMD) for UK local authorities, several participating urban areas were among the most disadvantaged in the country.
- “Member cities like several major towns place in the most deprived 30 nationally under the 2025 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 England. The data highlights the scale of difficulties facing local leaders across key cities in the coming year,” the report added.
“Local government leaders have been explicit about the necessity for a equitable and lasting funding system that accounts for and responds to the actual extent of disadvantage and demand,” said a council leader.
“Without this, local authorities will persist to face impossible choices around which essential services to fund, and which to cut, to the disadvantage of their residents.”
A fifth of councils have cut or compromised care services in the past 12 months, the study found.
