Based on a latest poll of local authorities, English councils are preparing to sell social clubs, sports centres, and retail spaces as they bet on a rapid disposal of assets to stabilize finances.
Growing Financial Challenges Drive Asset Sales
A coalition of councils for major urban areas in the UK stated that six out of ten of local authorities are intending to sell assets to cover the escalating costs of social services for vulnerable individuals.
Councils have previously 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 asset sales or face insolvency.
The group noted that a significant number of authorities seeking to raise money from a fire sale of assets marked “a clear change from 2024, when the largest share (60%) of municipal officials stated they would prioritise service redesigns and using financial reserves to manage increasing fiscal pressures.”
Detailed Examples of Planned Disposals
Medway Council in southeast England announced its asset disposal plan included the sale of a shopping centre in a local town and a social club in Rochester to generate £20m over the next half-decade.
- A local golf course and business parks owned in Worcestershire and Suffolk, which all provide rental income for the authority, will additionally be sold under the plan.
Council Tax Increases and Broader Financial Strains
The survey of councils in the key cities group, which covers Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of councils will have to increase local levies next spring to address the growing cost of core provisions, increased rates of homelessness, and a persistent housing shortage.
The authority said it will press ahead 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 creative strategies but some of these require time to deliver both better provisions and financial savings,” said a council leader.
He continued: “We face 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 2010-24, which is extremely difficult.”
Countrywide Patterns and Projections
Research of county councils this week also found local finances being stretched by the increasing figures of young people and adults requiring Send support.
A network of councils projected that council deficits will reach £4.4bn a year by 2029, as they grapple to cope with rising needs.
Government officials have delayed scheduled changes to the special educational needs framework until next year after a policy document setting out those changes was recently delayed.
Disadvantage and Financial Gaps
According to the latest deprivation measures (the Index of Multiple Deprivation) covering UK local authorities, many participating urban areas were included in the most disadvantaged in England.
- “Member cities like several major towns rank in the top 30 nationally under the latest IMD measures,” said the study.
“While only one key city is among the top 10 for deprived neighbourhoods nationally, urban areas are far more likely to be in the worst-off 20% of England. The figures underscores the extent of difficulties facing local leaders across key cities in the next twelve months,” the analysis added.
“Local government leaders have been clear about the need for a equitable and lasting financial structure that accounts for and responds to the real levels of deprivation and need,” stated Michael Mordey.
“Without this, local authorities will continue to face impossible choices around which vital provisions to fund, and which to cut, to the disadvantage of their communities.”
One in five of councils have cut or compromised care services in the past 12 months, the survey found.
