Based on a latest survey of local authorities, English councils are preparing to sell community centers, athletic facilities, and retail spaces as they bet on a rapid disposal of assets to balance the books.
Increasing Fiscal Pressures Drive Asset Sales
The Key Cities Group representing major urban areas in the UK stated that six out of ten of local authorities are planning to sell assets to cover the rising costs of adult and children’s social care.
Councils have previously come under fire for disposing of playing fields and open spaces to support their finances, but they argue they must proceed to generate essential revenue from property disposals or face insolvency.
The group said that a significant number of councils seeking to generate funds from a quick sale of assets represented “a clear change from 2024, when the majority (60%) of local leaders said they would focus on restructuring services and utilising financial reserves to weather growing fiscal pressures.”
Detailed Examples of Proposed Disposals
One local authority in southeast England announced its asset disposal plan featured the disposal of a retail complex in a local town and a social club in another town to raise 20 million pounds over five years.
- Gillingham golf club and commercial properties owned in Worcestershire and Suffolk, which all generate rent for Medway council, will also be disposed of under the strategy.
Local Levy Rises and Broader Fiscal Pressures
The survey of councils in the key cities group, which covers Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of authorities will have to raise local levies next spring to cover the growing cost of essential services, higher levels of homelessness, and a longstanding accommodation deficit.
Medway council explained it will proceed with property disposals after sharp increases in the cost of children services, special educational needs and disability (Send) provision, elderly and disability services, and short-term housing.
“We are adopting innovative approaches but some of these require time to achieve both improved services and cost efficiency,” stated Vince Maple.
He added: “We face demographic pressures which will persist to add to the pressures we have. As a unitary authority, we had a drastic reduction in our revenue support grant from over the past decade, which is very challenging.”
Countrywide Patterns and Projections
A survey of county councils this week further found local finances being stretched by the increasing figures of young people and adults needing Send support.
The County Councils Network said that council deficits will hit £4.4bn a year by the end of the decade, 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
According to the latest indices of deprivation (the Index of Multiple Deprivation) covering English councils, many participating urban areas were among the most deprived in England.
- “Participating urban centers like several major towns place in the top 30 nationally under the latest IMD measures,” noted the report.
“Although only a single urban area is among the ten most deprived for disadvantaged communities nationally, cities are far more likely to be in the worst-off 20% of the nation. The data highlights the extent of challenges facing municipal officials across major urban centers in the next twelve months,” the analysis concluded.
“Council officials have been clear about the necessity for a fair and sustainable financial structure that reflects and addresses the actual extent of disadvantage and need,” said a council leader.
“Lacking this, councils will continue to face difficult decisions around which vital provisions to allocate spend to, and which to cut, to the detriment of their communities.”
A fifth of councils have cut or compromised social care provision in the last year, the study found.
