According to a new study of local authorities, UK councils are planning to sell community centers, athletic facilities, and shopping arcades as they rely on a fire sale of properties to stabilize finances.
Growing Financial Challenges Prompt Asset Sales
The Key Cities Group for second-tier cities in the UK stated that 60% of local authorities are planning to sell assets to cover the rising costs of adult and children’s social care.
Local governments have in the past come under fire for disposing of public land and land to shore up their budgets, but they contend they must continue to generate essential revenue from asset sales or face insolvency.
This coalition said that a significant number of councils attempting to raise money from a quick sale of assets marked “a distinct shift from 2024, when the majority (six in ten) of local leaders said they would focus on service redesigns and utilising financial reserves to manage increasing fiscal pressures.”
Detailed Examples of Planned Sales
Medway Council in Kent announced its property management strategy included the disposal of a retail complex in Rainham and a community venue in Rochester to raise 20 million pounds over the next half-decade.
- A local golf course and business parks owned in two English counties, which all provide rental income for Medway council, will also be sold under the strategy.
Local Levy Rises and Broader Fiscal Pressures
This research of councils in the coalition, which covers Sunderland, Southampton, Gloucester and Salford, also found that over seven in ten of authorities will have to increase local levies next spring to address the growing cost of essential services, higher levels of homelessness, and a persistent housing shortage.
Medway council explained it will press ahead with property disposals after sharp increases in the cost of children services, special educational needs and disability (Send) provision, adult social care, and short-term housing.
“We are taking innovative approaches but some of these require time to achieve both improved services and financial savings,” stated Vince Maple.
He continued: “We face demographic pressures which will persist to increase the pressures we have. As a local government body, we had a drastic reduction in our central funding from 2010-24, which is very challenging.”
Countrywide Patterns and Forecasts
A survey of county councils recently further found council budgets being stretched by the increasing figures of young people and older individuals requiring Send support.
The County Councils Network projected that local shortfalls will hit £4.4bn a year by 2029, as they struggle to cope with increased demand.
Ministers have delayed planned reforms to the special educational needs framework until next year after a white paper outlining those reforms has been postponed.
Disadvantage and Funding Gaps
Based on the most recent indices of deprivation (the Index of Multiple Deprivation) for UK local authorities, several key cities members were included in the most deprived in the country.
- “Member cities like several major towns place in the most deprived 30 nationally under the 2025 IMD measures,” noted the study.
“Although only a single urban area is among the ten most deprived for disadvantaged communities countrywide, cities are much more prone to be in the worst-off 20% of the nation. The data highlights the extent of difficulties facing municipal officials across key cities in the next twelve months,” the analysis added.
“Council officials have been explicit about the need for a equitable and lasting funding system that reflects and responds to the real levels of disadvantage and need,” stated Michael Mordey.
“Lacking this, local authorities will persist to face difficult decisions around which essential services to fund, and which to cut, to the detriment of their residents.”
One in five of councils have cut or compromised care services in the last year, the survey revealed.
