Based on a recent poll of local authorities, English councils are planning to sell social clubs, athletic facilities, and retail spaces as they bet on a rapid disposal of properties to stabilize finances.
Growing Financial Pressures Drive Asset Sales
The Key Cities Group representing major urban areas in the UK reported that 60% of councils are intending to sell assets to meet the rising costs of adult and children’s social care.
Local governments have in the past faced criticism for selling public land and open spaces to support their finances, but they contend they must proceed to generate essential revenue from asset sales or face insolvency.
The group said that a significant number of authorities seeking to generate funds from a quick sale of holdings represented “a clear change from 2024, when the largest share (60%) of local leaders stated they would focus on restructuring services and utilising financial reserves to manage growing fiscal pressures.”
Specific Cases of Proposed Sales
One local authority in Kent announced its asset disposal plan featured the sale of a retail complex in a local town and a social club in another town to generate £20m over five years.
- A local golf course and commercial properties owned in Worcestershire and Suffolk, which all provide rental income for the authority, will additionally be sold under the plan.
Council Tax Increases and Wider Financial Strains
This research of local authorities in the coalition, which covers Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of councils will have to raise council taxes next April to address the growing cost of core provisions, increased rates of homelessness, and a persistent accommodation deficit.
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 short-term housing.
“We are taking innovative approaches but some of these require time to deliver both better provisions and cost efficiency,” said a council leader.
He continued: “We face population challenges which will continue to add to the pressures we have. As a local government body, we had a drastic reduction in our revenue support grant from 2010-24, which is very challenging.”
Countrywide Trends and Projections
Research of county councils this week further found council budgets being strained by the growing number of children and adults needing special educational assistance.
A network of councils said that council deficits will hit 4.4 billion pounds a year by 2029, as they grapple to manage increased demand.
Ministers have delayed scheduled changes to the Send system until next year after a policy document outlining those reforms was recently delayed.
Deprivation and Funding Gaps
According to the most recent deprivation measures (IMD) covering UK local authorities, many key cities members were among the most disadvantaged in the country.
- “Member cities like several major towns place in the most deprived 30 nationally under the latest deprivation indices,” said the study.
“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 most deprived fifth of the nation. The figures highlights the scale of difficulties facing local leaders across key cities in the next twelve months,” the report added.
“Council officials have been explicit about the necessity for a fair and sustainable funding system that accounts for and responds to the real levels of disadvantage and need,” said Michael Mordey.
“Lacking this, local authorities will persist to face impossible choices around which vital provisions to allocate spend to, and which to cut, to the detriment of their residents.”
A fifth of local authorities have reduced or weakened care services in the past 12 months, the survey found.
