According to a new study of local authorities, English councils are planning to offload social clubs, sports centres, and retail spaces as they bet on a fire sale of properties to stabilize finances.
Growing Financial Pressures Drive Asset Sales
The Key Cities Group representing major urban areas in England reported that 60% of councils are planning to dispose of properties to cover the rising costs of adult and children’s social care.
Councils have in the past come under fire 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.
This coalition noted that a significant number of councils attempting to raise money from a quick sale of assets represented “a clear change from 2024, when the majority (60%) of municipal officials said they would prioritise restructuring services and using savings to weather increasing financial challenges.”
Specific Cases of Proposed Disposals
One local authority in southeast England said its property management strategy included the disposal of a shopping centre in a local town and a social club in another town to raise £20m over the next half-decade.
- Gillingham golf club and business parks held in Worcestershire and Suffolk, which all provide rental income for the authority, will additionally be sold under the strategy.
Council Tax Rises and Wider Financial Pressures
The survey of councils in the coalition, which covers Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of authorities will need to raise local levies next April to address the growing cost of core provisions, higher levels of housing insecurity, and a longstanding accommodation deficit.
The authority said it will press ahead with asset sales after steep rises in the cost of children services, special educational needs and disability (Send) provision, adult social care, and temporary accommodation.
“We are adopting innovative approaches but certain measures require time to achieve both better provisions and financial savings,” stated Vince Maple.
He added: “We face population challenges which will continue to increase the strains we have. As a unitary authority, we had a drastic reduction in our central funding from 2010-24, which is very challenging.”
National Trends and Projections
A survey of regional authorities recently further found council budgets being strained by the growing number of children and adults needing Send support.
The County Councils Network projected that council deficits will reach £4.4bn a year by 2029, as they struggle to manage increased demand.
Government officials have put off scheduled changes to the Send system until next year after a white paper setting out those reforms has been postponed.
Disadvantage and Funding Gaps
Based on the latest deprivation measures (the Index of Multiple Deprivation) for English councils, several key cities members were among the most deprived in the country.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the top 30 across the country under the latest deprivation indices,” said the report.
“Although only a single urban area is in the ten most deprived for deprived neighbourhoods nationally, urban areas are far more likely to be in the worst-off 20% of England. The data underscores the scale of difficulties confronting local leaders across major urban centers in the next twelve months,” the analysis concluded.
“Local government leaders have been clear about the need for a fair and sustainable financial structure that reflects and addresses the real levels of disadvantage and need,” stated a council leader.
“Lacking this, local authorities will persist to face impossible choices around which vital provisions to fund, and which to cut, to the detriment of their communities.”
A fifth of local authorities have cut or compromised care services in the past 12 months, the study found.
