According to a new study of local authorities, UK councils are planning to offload social clubs, sports centres, and shopping arcades as they bet on a rapid disposal of properties to stabilize finances.
Increasing Financial Pressures Drive Asset Sales
A coalition of councils representing second-tier cities in the UK reported that six out of ten of local authorities are intending to dispose of properties to meet the rising costs of adult and children’s social care.
Councils have previously come under fire for selling playing fields and open spaces to shore up their finances, but they argue they must proceed to generate essential revenue from asset sales or declare themselves bankrupt.
The group noted that a high proportion of councils seeking to generate funds from a quick sale of holdings marked “a clear change from 2024, when the majority (60%) of municipal officials said they would focus on restructuring services and utilising financial reserves to weather growing fiscal pressures.”
Detailed Examples of Planned Sales
One local authority in Kent said its asset disposal plan included the sale of a shopping centre in Rainham and a social club in another town to generate 20 million pounds over five years.
- Gillingham golf club and commercial properties owned in two English counties, which all provide rental income for the authority, will additionally be sold under the plan.
Council Tax Rises and Broader Fiscal Pressures
This research of councils in the coalition, which includes Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of councils will have to raise local levies next spring to cover the growing cost of core provisions, increased rates of homelessness, and a persistent accommodation deficit.
Medway council said it will proceed with property disposals after sharp increases in the cost of youth support, special educational needs and disability (Send) provision, elderly and disability services, and temporary accommodation.
“We are taking creative strategies but certain measures take time to achieve both better provisions and cost efficiency,” stated Vince Maple.
He continued: “We face population challenges which will persist to add to the strains we have. As a unitary authority, we had a drastic reduction in our central funding from 2010-24, which is extremely difficult.”
National Patterns and Forecasts
A survey of regional authorities recently also found local finances being strained by the increasing figures of children and older individuals requiring Send support.
A network of councils projected that council deficits will hit £4.4bn a year by the end of the decade, as they grapple to manage rising needs.
Ministers have delayed planned reforms to the Send system until the coming year after a white paper setting out those reforms was recently delayed.
Disadvantage and Financial Gaps
According to the latest indices of deprivation (IMD) for English councils, many key cities members were included in the most disadvantaged in the country.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the most deprived 30 nationally under the latest deprivation indices,” said the study.
“Although only one key city is among the ten most deprived for disadvantaged communities countrywide, cities are much more prone to be in the worst-off 20% of England. The data highlights the scale of difficulties facing municipal officials across key cities in the next twelve months,” the analysis concluded.
“Local government leaders have been clear about the necessity for a equitable and lasting financial structure that accounts for and responds to the real levels of disadvantage and demand,” said Michael Mordey.
“Without this, councils will persist to face impossible choices around which essential services to allocate spend to, and which to cut, to the detriment of their communities.”
One in five of councils have cut or compromised care services in the past 12 months, the study found.
