According to a new survey of local authorities, UK councils are preparing to sell community centers, athletic facilities, and shopping arcades as they bet on a fire sale of assets to stabilize finances.
Increasing Fiscal Pressures Drive Asset Sales
The Key Cities Group representing second-tier cities in England reported that 60% of councils are intending to dispose of properties to cover the escalating costs of adult and children’s social care.
Councils have previously come under fire for selling playing fields and land to support their finances, but they argue they must proceed to raise vital cash from property disposals or face insolvency.
The group noted that a significant number of authorities seeking to raise money from a fire sale of holdings represented “a distinct shift from 2024, when the largest share (60%) of local leaders said they would prioritise restructuring services and utilising savings to manage increasing fiscal pressures.”
Detailed Cases of Planned Sales
One local authority in southeast England said its property management strategy included the sale of a shopping centre in Rainham and a community venue in another town to raise 20 million pounds over five years.
- Gillingham golf club and commercial properties held in two English counties, which all provide rental income for Medway council, will additionally be sold under the plan.
Council Tax Rises and Broader Financial Strains
This research of councils in the coalition, which covers several urban centers, further found that over seven in ten of councils will need to raise local levies next spring to address the growing cost of essential services, higher levels of homelessness, and a longstanding housing shortage.
The authority said it will press ahead with asset sales after steep rises in the cost of youth support, support for vulnerable learners, adult social care, and short-term housing.
“We are adopting creative strategies but certain measures require time to achieve both better provisions and cost efficiency,” said a council leader.
He added: “We face demographic pressures which will continue to increase the strains we have. As a unitary authority, we had a drastic reduction in our revenue support grant from 2010-24, which is extremely difficult.”
National Trends and Projections
Research of county councils this week also found council budgets being strained by the increasing figures of young people and older individuals needing Send support.
The County Councils Network projected that council deficits will reach 4.4 billion pounds a year by the end of the decade, as they struggle to manage increased demand.
Government officials have put off planned reforms to the Send system until next year after a white paper outlining those changes was recently delayed.
Deprivation and Financial Gaps
Based on the most recent deprivation measures (the Index of Multiple Deprivation) covering English councils, several participating urban areas were among the most deprived in England.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the top 30 nationally under the latest IMD measures,” noted the report.
“Although only one key city is in the ten most deprived for deprived neighbourhoods countrywide, urban areas are far more likely to be in the worst-off 20% of the nation. The data underscores the extent of difficulties facing local leaders across key cities in the next twelve months,” the report added.
“Council officials have been explicit about the need for a equitable and lasting financial structure that reflects and responds to the actual extent of deprivation and need,” stated a council leader.
“Without this, local authorities will persist to face impossible choices around which essential services to fund, and which to reduce, to the detriment of their communities.”
A fifth of councils have cut or compromised social care provision in the last year, the survey revealed.
