According to a new study of local authorities, English councils are preparing to sell community centers, athletic facilities, and shopping arcades as they rely on a fire sale of properties to stabilize finances.
Increasing Financial Challenges Drive Asset Sales
A coalition of councils for second-tier cities in England stated that 60% of local authorities are planning to dispose of properties to meet the escalating costs of social services for vulnerable individuals.
Councils have previously come under fire for selling public land and open spaces to shore up their budgets, but they argue they must continue to raise vital cash from property disposals or face insolvency.
The group noted that a significant number of councils seeking to raise money from a quick sale of assets represented “a distinct shift from 2024, when the largest share (60%) of local leaders said they would prioritise restructuring services and utilising financial reserves to weather increasing financial challenges.”
Detailed Cases of Proposed Disposals
Medway Council in Kent announced its property management strategy included the sale of a shopping centre in a local town and a social club in another town to generate 20 million pounds over five years.
- Gillingham golf club and commercial properties held in Worcestershire and Suffolk, which all generate rent for the authority, will additionally be sold under the strategy.
Council Tax Rises and Wider Fiscal Strains
This research of local authorities in the coalition, which covers Sunderland, Southampton, Gloucester and Salford, also found that over seven in ten of councils will need to increase council taxes next spring to address the growing cost of essential services, increased rates of housing insecurity, and a longstanding accommodation deficit.
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 short-term housing.
“We are taking creative strategies but certain measures require time to deliver both better provisions and cost efficiency,” said a council leader.
He continued: “There are demographic pressures which will persist to add to the strains we have. As a unitary authority, we had a drastic reduction in our revenue support grant from over the past decade, which is very challenging.”
Countrywide Trends and Forecasts
Research of county councils recently further found local finances being strained by the growing number of children and older individuals needing special educational assistance.
A network of councils said that local shortfalls will reach £4.4bn a year by 2029, as they grapple to manage rising needs.
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.
Deprivation and Funding Gaps
According to the latest deprivation measures (the Index of Multiple Deprivation) for UK local authorities, several key cities members were among the most deprived in the country.
- “Member cities like several major towns place in the top 30 nationally under the 2025 IMD measures,” said the study.
“Although only a single urban area is in the top 10 for disadvantaged communities nationally, cities are much more prone to be in the worst-off 20% of England. The figures highlights the scale of difficulties confronting local leaders across key cities in the next twelve months,” the report concluded.
“Local government leaders have been clear about the necessity for a fair and sustainable financial structure that reflects and addresses the real levels of disadvantage and need,” said a council leader.
“Without 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 social care provision in the last year, the study revealed.
