According to a new survey of municipal councils, English councils are preparing to sell community centers, sports centres, and retail spaces as they bet on a fire sale of properties to balance the books.
Growing Fiscal Challenges Drive Asset Sales
A coalition of councils for major urban areas in the UK stated that 60% of local authorities are planning to sell assets to cover the rising costs of adult and children’s social care.
Local governments have in the past come under fire for selling public land and open spaces to support their budgets, but they argue they must continue to raise vital cash from property disposals or declare themselves bankrupt.
The group noted that a high proportion of councils attempting to generate funds from a fire sale of assets represented “a clear change from 2024, when the largest share (six in ten) of municipal officials said they would prioritise service redesigns and using financial reserves to manage increasing fiscal pressures.”
Detailed Cases of Proposed Sales
Medway Council in Kent announced its property management strategy included the disposal of a retail complex in Rainham and a community venue in Rochester to generate £20m over five years.
- A local golf course and business parks owned in two English counties, which all provide rental income for the authority, will additionally be sold under the strategy.
Council Tax Rises and Broader Fiscal Strains
The survey of councils in the key cities group, which covers Sunderland, Southampton, Gloucester and Salford, also found that more than 70% of authorities will have to raise council taxes next April to cover the growing cost of essential services, increased rates of housing insecurity, and a longstanding housing shortage.
Medway council said it will press ahead with property disposals after steep rises in the cost of children services, special educational needs and disability (Send) provision, elderly and disability services, and short-term housing.
“We are taking innovative approaches but some of these require time to deliver both improved services and cost efficiency,” stated Vince Maple.
He continued: “We face population challenges which will persist to add to the pressures we have. As a local government body, we had a 91% cut in our central funding from 2010-24, which is extremely difficult.”
Countrywide Trends and Projections
Research of regional authorities recently further found local finances being stretched by the increasing figures of children and adults requiring special educational assistance.
The County Councils Network said that local shortfalls will hit 4.4 billion pounds a year by 2029, as they struggle to cope with increased demand.
Ministers have delayed planned reforms to the Send system until the coming year after a white paper outlining those reforms was recently delayed.
Disadvantage and Financial Shortfalls
According to the most recent deprivation measures (the Index of Multiple Deprivation) for English councils, 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 nationally under the latest IMD measures,” noted the report.
“Although only one key city is among the ten most deprived for deprived neighbourhoods countrywide, urban areas are much more prone to be in the worst-off 20% of England. The figures highlights the scale of difficulties facing local leaders across key cities 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 real levels of deprivation and need,” stated a council leader.
“Without this, local authorities will continue to face difficult decisions around which essential services to allocate spend to, and which to cut, to the detriment of their residents.”
One in five of local authorities have reduced or weakened social care provision in the last year, the survey revealed.
