According to a latest study of local authorities, UK councils are planning to sell social clubs, athletic facilities, and shopping arcades as they bet on a fire sale of assets to balance the books.
Increasing Fiscal Challenges Drive Asset Sales
The Key Cities Group representing second-tier cities in England stated that 60% of local authorities are planning to dispose of properties to cover the escalating costs of adult and children’s social care.
Councils have previously faced criticism for disposing of public land and open spaces to shore up their budgets, but they contend 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 marked “a clear change from 2024, when the largest share (six in ten) of local leaders said they would focus on restructuring services and utilising financial reserves to manage growing fiscal pressures.”
Specific Examples of Proposed Disposals
One local authority in southeast England said 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 Medway council, will also be disposed of under the plan.
Council Tax Increases and Broader Fiscal Strains
This research of local authorities in the key cities group, which covers several urban centers, also found that more than 70% of authorities will have to increase council taxes next spring to address the rising cost of essential services, increased rates of housing insecurity, and a longstanding housing shortage.
Medway council 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 adopting innovative approaches but some of these take time to achieve both improved services and cost efficiency,” said a council leader.
He continued: “We face demographic pressures which will persist to increase the strains we have. As a local government body, we had a drastic reduction in our central funding from over the past decade, which is extremely difficult.”
National Patterns and Projections
Research of county councils this week further found local finances being strained by the increasing figures of children and adults needing special educational assistance.
The County Councils Network said that local shortfalls will hit £4.4bn a year by 2029, as they grapple to manage rising needs.
Government officials have delayed scheduled changes to the Send system until next year after a policy document setting out those changes has been postponed.
Disadvantage and Financial Shortfalls
Based on the latest deprivation measures (IMD) covering English councils, several participating urban areas were among the most deprived in England.
- “Member cities like several major towns rank in the most deprived 30 across the country under the 2025 deprivation indices,” said the study.
“Although only one key city is among the ten most deprived for deprived neighbourhoods countrywide, cities 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.
“Local government leaders have been clear about the necessity for a equitable and lasting financial structure that reflects and responds to the actual extent of deprivation and demand,” stated a council leader.
“Without this, councils will persist to face difficult decisions around which vital provisions to allocate spend to, and which to cut, to the detriment of their residents.”
A fifth of councils have cut or compromised care services in the past 12 months, the study revealed.
