Based on a latest poll of local authorities, English councils are preparing to sell social clubs, sports centres, and shopping arcades as they bet on a fire sale of properties to balance the books.
Increasing Financial Pressures Drive Asset Sales
A coalition of councils for second-tier cities in England reported that 60% 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 shore up their budgets, but they contend they must proceed to generate essential revenue from property disposals or declare themselves bankrupt.
This coalition noted that a high proportion of councils seeking to raise money from a fire sale of assets represented “a clear change from 2024, when the majority (60%) of local leaders said they would prioritise service redesigns and utilising savings to weather increasing financial challenges.”
Detailed Examples of Planned Disposals
One local authority in Kent said its asset disposal plan featured the sale of a retail complex in Rainham and a community venue in another town to generate 20 million pounds over five years.
- A local golf course and business parks held in Worcestershire and Suffolk, which all generate rent for the authority, will also be disposed of under the strategy.
Council Tax Increases and Broader Fiscal Pressures
The survey of councils in the coalition, which covers Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of authorities will have to increase local levies next spring to cover the rising cost of core provisions, increased rates of housing insecurity, and a persistent accommodation deficit.
The authority said it will press ahead with asset sales after steep rises in the cost of children services, support for vulnerable learners, elderly and disability services, and short-term housing.
“We are taking creative strategies but some of these require time to deliver both better provisions and financial savings,” stated Vince Maple.
He continued: “We face population challenges which will continue to increase the strains we have. As a local government body, we had a 91% cut in our central funding from 2010-24, which is extremely difficult.”
National Trends and Forecasts
Research of county councils this week further found council budgets being strained by the increasing figures of children and older individuals needing special educational assistance.
A network of councils said that local shortfalls will hit £4.4bn a year by the end of the decade, as they struggle to manage rising needs.
Government officials have delayed planned reforms to the Send system until the coming year after a white paper setting out those changes has been postponed.
Deprivation and Funding Gaps
According to the most recent indices of deprivation (IMD) covering UK local authorities, several participating urban areas were included in the most disadvantaged in England.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the most deprived 30 nationally under the latest IMD measures,” said the study.
“Although only one key city 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 data underscores the scale of difficulties confronting 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 accounts for and responds to the real levels of deprivation and demand,” said Michael Mordey.
“Without this, councils will continue to face difficult decisions around which essential services to allocate spend to, and which to cut, to the disadvantage of their residents.”
A fifth of councils have cut or compromised care services in the last year, the study revealed.
