According to a new poll of municipal councils, English councils are preparing to sell community centers, sports centres, and shopping arcades as they bet on a rapid disposal of assets to stabilize finances.
Increasing Fiscal Pressures Prompt Asset Sales
A coalition of councils representing second-tier cities in the UK stated that 60% of councils are intending to sell assets to meet the escalating costs of adult and children’s social care.
Local governments have previously faced criticism for disposing of public land and land to support their finances, but they contend they must continue to generate essential revenue from property disposals or declare themselves bankrupt.
The group said that a high proportion of councils attempting to raise money from a quick sale of holdings represented “a clear change from 2024, when the majority (six in ten) of local leaders stated they would prioritise service redesigns and utilising financial reserves to weather growing fiscal pressures.”
Detailed Examples of Proposed Sales
One local authority in southeast England said its asset disposal plan featured the sale of a shopping centre in a local town and a community venue in Rochester to generate £20m over the next half-decade.
- Gillingham golf club and business parks held in Worcestershire and Suffolk, which all generate rent for the authority, will additionally be sold under the strategy.
Council Tax Increases and Wider Fiscal Strains
The survey of councils in the key cities group, which includes several urban centers, further found that more than 70% of authorities will need to increase council taxes next spring to cover the growing cost of core provisions, increased rates of housing insecurity, and a persistent housing shortage.
The authority said it will proceed with property disposals after sharp increases 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 certain measures take time to deliver both better provisions and cost efficiency,” stated Vince Maple.
He added: “We face population challenges which will persist to add to the strains we have. As a local government body, we had a 91% cut in our central funding from 2010-24, which is very challenging.”
National Patterns and Projections
Research of regional authorities recently also found council budgets being strained by the growing number of children and older individuals needing Send support.
The County Councils Network said that council deficits will hit £4.4bn a year by the end of the decade, as they struggle to cope with rising needs.
Government officials have delayed scheduled changes to the Send system until next year after a policy document setting out those changes has been postponed.
Deprivation and Financial Shortfalls
Based on the latest deprivation measures (IMD) covering UK local authorities, several participating urban areas were included in the most disadvantaged in England.
- “Member cities like several major towns place in the top 30 nationally under the latest IMD measures,” noted the study.
“Although only one key city is in the top 10 for deprived neighbourhoods nationally, urban areas are much more prone to be in the worst-off 20% of the nation. The data underscores the extent of challenges confronting municipal officials across major urban centers in the next twelve months,” the analysis added.
“Council officials have been clear about the need for a equitable and lasting funding system that accounts for and responds to the real levels of disadvantage and demand,” stated a council leader.
“Lacking this, local authorities will persist to face impossible choices around which vital provisions to allocate spend to, and which to reduce, to the disadvantage of their residents.”
A fifth of local authorities have reduced or weakened care services in the past 12 months, the study found.
