According to a latest poll of municipal councils, English councils are preparing to offload community centers, athletic facilities, and retail spaces as they rely on a rapid disposal of assets to stabilize finances.
Increasing Fiscal Pressures Prompt Asset Sales
The Key Cities Group representing second-tier cities in the UK stated that 60% of local authorities are intending to dispose of properties to meet the escalating costs of adult and children’s social care.
Councils have previously come under fire for selling public land and open spaces to shore up their finances, but they argue they must proceed to generate essential revenue from property disposals or declare themselves bankrupt.
The group noted that a high proportion of authorities seeking to raise money from a quick sale of assets represented “a clear change from 2024, when the largest share (six in ten) of municipal officials said they would prioritise service redesigns and using financial reserves to manage growing financial challenges.”
Detailed Examples of Planned Sales
One local authority in Kent announced its asset disposal plan included the disposal of a retail complex in Rainham and a social club in another town to generate £20m over five years.
- Gillingham golf club and business parks owned in two English counties, which all provide rental income for Medway council, will additionally be sold under the strategy.
Council Tax Increases and Wider Fiscal Pressures
The survey of local authorities in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of authorities will have to increase local levies next April to cover the growing cost of essential services, increased rates of homelessness, and a longstanding housing shortage.
The authority explained it will press ahead with property disposals after sharp increases in the cost of youth support, support for vulnerable learners, elderly and disability services, and temporary accommodation.
“We are taking creative strategies but some of these take time to achieve both better provisions and financial savings,” said a council leader.
He continued: “We face demographic pressures which will persist to add to the strains we have. As a unitary authority, we had a 91% cut in our revenue support grant from 2010-24, which is extremely difficult.”
National Patterns and Projections
Research of regional authorities recently also found council budgets being strained by the increasing figures of young people and older individuals needing Send support.
A network of councils projected that council deficits will hit £4.4bn a year by 2029, as they grapple to manage increased demand.
Government officials have delayed scheduled changes to the Send system until next year after a policy document outlining those reforms was recently delayed.
Deprivation and Financial Gaps
Based on the latest indices of deprivation (IMD) covering English councils, many key cities members were included in the most disadvantaged in the country.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the top 30 nationally under the latest deprivation indices,” said the report.
“Although only one key city is in the ten most deprived for disadvantaged communities countrywide, urban areas are much more prone to be in the most deprived fifth of the nation. The data highlights the scale of difficulties facing local leaders across key cities in the coming year,” the analysis added.
“Council officials have been explicit about the necessity for a equitable and lasting funding system that reflects and responds to the real levels of disadvantage and need,” stated a council leader.
“Without this, local authorities will persist to face difficult decisions around which essential services to fund, and which to reduce, to the detriment of their residents.”
A fifth of local authorities have cut or compromised social care provision in the past 12 months, the study found.
