Based on a recent poll 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.
Growing Fiscal Challenges Drive Asset Sales
The Key Cities Group representing major urban areas in England reported that six out of ten of councils are planning to sell assets to meet the rising costs of adult and children’s social care.
Councils have in the past faced criticism for selling playing fields and open spaces to support their budgets, but they argue they must proceed to generate essential revenue from asset sales or face insolvency.
The group noted that a high proportion of councils attempting to raise money from a fire sale of assets marked “a clear change from 2024, when the majority (six in ten) of municipal officials stated they would prioritise restructuring services and using savings to manage increasing financial challenges.”
Specific Examples of Planned Disposals
Medway Council in southeast England said its asset disposal plan included the disposal of a shopping centre in Rainham and a community venue in another town to generate 20 million pounds over five years.
- Gillingham golf club and commercial properties owned in two English counties, which all generate rent for the authority, will additionally be disposed of under the strategy.
Council Tax Increases and Broader Fiscal Pressures
This research of local authorities in the coalition, which includes Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of authorities will have to increase local levies next April to cover the rising cost of essential services, increased rates of housing insecurity, and a persistent housing shortage.
The authority explained it will press ahead with property disposals after steep rises in the cost of children services, support for vulnerable learners, adult social care, and temporary accommodation.
“We are taking creative strategies but certain measures take time to deliver both better provisions and cost efficiency,” stated Vince Maple.
He continued: “There are population challenges which will persist to add to the strains we have. As a local government body, we had a 91% cut in our revenue support grant from over the past decade, which is extremely difficult.”
National Patterns and Projections
A survey of regional authorities this week further found local finances being strained by the increasing figures of children and adults needing special educational assistance.
A network of councils projected that council deficits will reach 4.4 billion pounds a year by 2029, as they grapple to cope with rising needs.
Government officials have delayed planned reforms to the Send system until the coming year after a policy document outlining those changes has been postponed.
Disadvantage and Funding Gaps
According to the most recent deprivation measures (the Index of Multiple Deprivation) covering UK local authorities, several key cities members were among the most deprived in England.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the most deprived 30 nationally under the latest deprivation indices,” noted the study.
“Although only one key city is in the ten most deprived for deprived neighbourhoods countrywide, urban areas are much more prone to be in the most deprived fifth of the nation. The figures underscores the scale of difficulties facing municipal officials across major urban centers in the coming year,” the report concluded.
“Council officials have been clear about the need for a fair and sustainable financial structure that reflects and responds to the actual extent of disadvantage and need,” said Michael Mordey.
“Without this, councils will persist to face impossible choices around which vital provisions to fund, and which to cut, to the detriment of their residents.”
A fifth of councils have reduced or weakened care services in the past 12 months, the study found.
