Based on a new survey of local authorities, English councils are planning to offload social clubs, sports centres, and shopping arcades as they rely on a fire sale of assets to stabilize finances.
Growing Financial Pressures Prompt Asset Sales
The Key Cities Group representing second-tier cities in England reported that six out of ten of councils are intending to sell assets to cover the escalating costs of adult and children’s social care.
Local governments have previously faced criticism for selling playing fields and open spaces to support their budgets, but they contend they must continue to generate essential revenue from property disposals or declare themselves bankrupt.
This coalition said that a high proportion of councils attempting to raise money from a fire sale of assets represented “a distinct shift from 2024, when the largest share (60%) of municipal officials said they would focus on restructuring services and utilising financial reserves to manage growing financial challenges.”
Specific Cases of Planned Disposals
One local authority in Kent announced its property management strategy included the sale of a shopping centre in Rainham and a community venue in Rochester to raise 20 million pounds over the next half-decade.
- A local golf course and commercial properties held in two English counties, which all provide rental income for the authority, will also be sold under the strategy.
Local Levy Increases 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 need to raise council taxes next April to cover the growing cost of essential services, higher levels of homelessness, and a persistent housing shortage.
The authority said it will proceed with property disposals after sharp increases in the cost of youth support, support for vulnerable learners, elderly and disability services, and temporary accommodation.
“We are adopting creative strategies but certain measures take time to deliver both better provisions and cost efficiency,” said a council leader.
He continued: “We face demographic pressures which will persist to increase the strains we have. As a unitary authority, we had a drastic reduction in our revenue support grant from over the past decade, which is extremely difficult.”
Countrywide Patterns and Forecasts
A survey of regional authorities this week also found council budgets being strained by the growing number of young people and adults needing Send support.
The County Councils Network said that council deficits will hit £4.4bn a year by the end of the decade, as they struggle to cope with rising needs.
Government officials have delayed scheduled changes to the Send system until the coming year after a white paper outlining those reforms has been postponed.
Deprivation and Funding Shortfalls
Based on the latest deprivation measures (IMD) covering UK local authorities, many key cities members were among the most deprived in England.
- “Participating urban centers like several major towns place in the most deprived 30 nationally under the 2025 deprivation indices,” noted the study.
“Although only one key city is among the ten most deprived for deprived neighbourhoods nationally, cities are far more likely to be in the worst-off 20% of the nation. The data underscores the extent of challenges facing municipal officials across major urban centers in the next twelve months,” the report concluded.
“Local government leaders have been clear about the necessity for a equitable and lasting funding system that reflects and responds to the actual extent of deprivation and demand,” said a council leader.
“Without this, local authorities will continue to face impossible choices around which essential services to fund, and which to cut, to the detriment of their communities.”
A fifth of councils have cut or compromised social care provision in the past 12 months, the survey revealed.
