According to a recent poll of local authorities, UK councils are planning to sell community centers, athletic facilities, and retail spaces as they bet on a fire sale of assets to stabilize finances.
Increasing Fiscal Pressures Drive Asset Sales
The Key Cities Group for major urban areas in the UK reported that six out of ten of councils are planning to dispose of properties to meet the escalating costs of adult and children’s social care.
Local governments have in the past come under fire for disposing of playing fields and open spaces to shore up their finances, but they argue they must continue to raise vital cash from asset sales or declare themselves bankrupt.
This coalition noted that a significant number of authorities seeking to raise money from a fire sale of assets marked “a distinct shift from 2024, when the largest share (60%) of local leaders stated they would focus on service redesigns and using financial reserves to weather growing financial challenges.”
Specific Examples of Proposed Disposals
Medway Council in southeast England announced its asset disposal plan featured the sale of a shopping centre in a local town and a community venue in another town to generate £20m over the next half-decade.
- A local golf course and business parks owned in two English counties, which all provide rental income for Medway council, will also be disposed of under the plan.
Council Tax Rises and Broader Fiscal Strains
The survey of councils in the key cities group, which includes several urban centers, also found that more than 70% of councils will need to raise council taxes next April to address the growing cost of essential services, higher levels of housing insecurity, and a longstanding 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 innovative approaches but some of these require time to deliver both better provisions and cost efficiency,” stated Vince Maple.
He continued: “We face population challenges which will persist to increase 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.”
Countrywide Patterns and Forecasts
A survey of county councils this week further found local finances being stretched by the growing number of young people and adults needing Send support.
A network of councils projected that local shortfalls will hit £4.4bn a year by the end of the decade, as they grapple to manage rising needs.
Government officials have put off scheduled changes to the Send system until the coming year after a policy document outlining those reforms has been postponed.
Deprivation and Financial Shortfalls
Based on the most recent deprivation measures (the Index of Multiple Deprivation) for English councils, many key cities members were included in the most disadvantaged in England.
- “Member cities like several major towns place in the most deprived 30 nationally under the 2025 IMD measures,” noted the report.
“While only a single urban area is in the top 10 for deprived neighbourhoods countrywide, urban areas are much more prone to be in the worst-off 20% of England. The figures underscores the scale of challenges confronting municipal officials across key cities in the next twelve months,” the analysis concluded.
“Council officials have been explicit about the need for a fair and sustainable financial structure that reflects and responds to the real levels of deprivation and demand,” said a council leader.
“Lacking this, local authorities will continue to face impossible choices around which essential services to fund, and which to reduce, to the disadvantage of their residents.”
A fifth of councils have cut or compromised social care provision in the last year, the study found.
