According to a latest study of local authorities, English councils are planning to offload social clubs, athletic facilities, and shopping arcades as they bet on a rapid disposal of assets to stabilize finances.
Growing 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 sell assets to meet the rising costs of adult and children’s social care.
Local governments have in the past faced criticism for disposing of playing fields and open spaces to support their finances, but they contend they must continue to raise vital cash from asset sales or declare themselves bankrupt.
This coalition noted that a significant number of councils seeking to raise money from a quick sale of assets marked “a clear change from 2024, when the largest share (six in ten) of local leaders said they would prioritise service redesigns and using savings to manage increasing financial challenges.”
Specific Examples of Planned Disposals
One local authority in Kent said its property management strategy featured the disposal of a shopping centre in Rainham and a community venue in another town to generate 20 million pounds over the next half-decade.
- Gillingham golf club and business parks held in two English counties, which all provide rental income for Medway council, will additionally be sold under the strategy.
Local Levy Rises and Broader Fiscal Pressures
This research of local authorities in the coalition, which covers Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of councils will have to raise local levies next April to address the rising cost of essential services, increased rates of housing insecurity, and a persistent accommodation deficit.
The authority said it will press ahead with property disposals after sharp increases in the cost of youth support, support for vulnerable learners, elderly and disability services, and short-term housing.
“We are adopting innovative approaches but some of these require time to deliver both improved services and cost efficiency,” stated a council leader.
He added: “We face demographic pressures which will persist to increase the strains we have. As a unitary authority, we had a 91% cut in our central funding from 2010-24, which is extremely difficult.”
National Trends and Projections
Research of county councils recently also found council budgets being strained by the growing number of children and adults needing Send support.
The County Councils Network projected that local shortfalls will reach £4.4bn a year by 2029, as they struggle to cope with increased demand.
Ministers have delayed planned reforms to the Send system until next year after a policy document setting out those changes was recently delayed.
Deprivation and Funding Shortfalls
According to the latest deprivation measures (the Index of Multiple Deprivation) covering UK local authorities, several participating urban areas were included in the most deprived in the country.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the top 30 nationally under the latest deprivation indices,” noted the report.
“While only a single urban area is among the top 10 for deprived neighbourhoods nationally, urban areas are much more prone to be in the most deprived fifth of the nation. The figures underscores the extent of difficulties facing local leaders across major urban centers in the next twelve months,” the report concluded.
“Local government leaders have been explicit about the need for a fair and sustainable funding system that accounts for and responds to the actual extent of deprivation and need,” stated a council leader.
“Lacking this, councils will persist to face impossible choices around which vital provisions 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 survey revealed.
