Based on a recent survey of municipal councils, English councils are planning to sell community centers, sports centres, and retail spaces as they rely on a rapid disposal of assets to stabilize finances.
Growing Financial Pressures Drive Asset Sales
A coalition of councils representing second-tier cities 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 previously come under fire for selling playing fields and land to support their budgets, but they argue they must continue to raise vital cash from property disposals or face insolvency.
This coalition said that a high proportion of authorities attempting to generate funds from a fire sale of assets represented “a clear change from 2024, when the majority (60%) of local leaders stated they would focus on restructuring services and using financial reserves to weather increasing fiscal pressures.”
Detailed Examples of Planned Disposals
Medway Council in Kent said its asset disposal plan included the disposal of a retail complex in a local town and a community venue in another town to raise £20m over five years.
- A local golf course and business parks owned in Worcestershire and Suffolk, which all provide rental income for Medway council, will additionally be sold under the plan.
Local Levy Rises and Broader Financial Pressures
This research of local authorities in the coalition, which covers several urban centers, further found that over seven in ten of authorities will have to raise council taxes next April to cover the rising cost of essential services, increased rates of housing insecurity, 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, adult social care, and short-term housing.
“We are adopting creative strategies but some of these take time to deliver both improved services and financial savings,” said a council leader.
He continued: “We face demographic pressures which will continue to add to the pressures we have. As a local government body, we had a 91% cut in our revenue support grant from 2010-24, which is extremely difficult.”
Countrywide Patterns and Projections
A survey of county councils this week also found council budgets being stretched by the growing number of children and adults requiring special educational assistance.
The County Councils Network projected that local shortfalls will hit 4.4 billion pounds a year by 2029, as they struggle to cope with increased demand.
Government officials have delayed planned reforms to the Send system until next year after a policy document setting out those changes has been postponed.
Disadvantage and Financial Shortfalls
According to the latest indices of deprivation (the Index of Multiple Deprivation) for UK local authorities, many 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 across the country under the latest deprivation indices,” said the report.
“While only one key city is among the top 10 for disadvantaged communities nationally, cities are much more prone to be in the worst-off 20% of the nation. The figures underscores the scale of challenges facing municipal officials across major urban centers in the coming year,” the analysis added.
“Local government leaders have been clear about the need for a equitable and lasting financial structure that accounts for and addresses the real levels of deprivation and demand,” said a council leader.
“Without this, local authorities will persist to face impossible choices around which essential services to fund, and which to cut, to the disadvantage of their communities.”
A fifth of councils have reduced or weakened social care provision in the last year, the study found.
