Based on a new survey of local authorities, English councils are preparing to offload community centers, sports centres, and shopping arcades as they bet on a rapid disposal of assets to balance the books.
Increasing Fiscal Challenges Prompt Asset Sales
The Key Cities Group for second-tier cities in the UK stated that 60% of councils are intending to sell assets to cover the rising costs of adult and children’s social care.
Councils have previously come under fire for disposing of public land and land to support their finances, but they argue they must continue to generate essential revenue from property disposals or declare themselves bankrupt.
This coalition said that a significant number of councils seeking to generate funds from a fire sale of assets represented “a clear change from 2024, when the largest share (six in ten) of local leaders said they would focus on service redesigns and utilising financial reserves to weather growing financial challenges.”
Detailed Examples of Proposed Disposals
One local authority in southeast England said its asset disposal plan featured the sale of a retail complex in Rainham and a social club in another town to generate 20 million pounds over the next half-decade.
- Gillingham golf club and commercial properties owned in Worcestershire and Suffolk, which all provide rental income for Medway council, will additionally be disposed of under the strategy.
Local Levy Increases and Wider Fiscal Pressures
The survey of local authorities in the key cities group, which covers Sunderland, Southampton, Gloucester and Salford, also found that over seven in ten of councils will need to increase local levies next April to cover the growing cost of essential services, higher levels of homelessness, and a persistent housing shortage.
The authority explained it will proceed with asset sales after sharp increases in the cost of youth support, support for vulnerable learners, adult social care, and short-term housing.
“We are adopting innovative approaches but certain measures require time to deliver both improved services and financial savings,” said Vince Maple.
He continued: “There are population challenges which will continue to increase the pressures we have. As a unitary authority, we had a 91% cut in our central funding from 2010-24, which is extremely difficult.”
National Trends and Forecasts
Research of county councils this week also found council budgets being stretched by the growing number of children and adults needing special educational assistance.
A network of councils projected that council deficits will reach £4.4bn a year by 2029, as they grapple to manage rising needs.
Government officials have delayed planned reforms to the special educational needs framework until the coming year after a white paper setting out those changes has been postponed.
Disadvantage and Funding Shortfalls
Based on the latest deprivation measures (the Index of Multiple Deprivation) covering UK local authorities, several key cities members were among the most deprived in England.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the top 30 across the country under the 2025 IMD measures,” noted the report.
“While only one key city is among the top 10 for disadvantaged communities nationally, cities are far more likely to be in the most deprived fifth of England. The figures underscores the scale of difficulties facing local leaders across major urban centers in the coming year,” the analysis concluded.
“Local government leaders have been clear about the necessity for a fair and sustainable funding system that reflects and responds to the actual extent of disadvantage and demand,” stated a council leader.
“Lacking this, local authorities will persist to face difficult decisions around which vital provisions to fund, and which to reduce, to the disadvantage of their residents.”
One in five of councils have reduced or weakened care services in the last year, the study revealed.
