According to a new survey of local authorities, English councils are preparing to sell social clubs, sports centres, and retail spaces as they rely on a rapid disposal of properties to balance the books.
Increasing Financial Challenges Drive Asset Sales
A coalition of councils for second-tier cities in the UK stated that six out of ten of councils are planning to dispose of properties to meet the escalating costs of social services for vulnerable individuals.
Councils have in the past come under fire for selling public land and land to support their budgets, but they contend they must proceed to raise vital cash from asset sales or face insolvency.
This coalition noted that a high proportion of authorities attempting to raise money from a quick sale of assets represented “a clear change from 2024, when the largest share (60%) of municipal officials stated they would prioritise service redesigns and using financial reserves to weather growing financial challenges.”
Detailed Cases of Planned Sales
Medway Council in Kent announced its property management strategy included the disposal of a shopping centre in a local town and a community venue in another town to generate £20m over the next half-decade.
- Gillingham golf club and business parks held in Worcestershire and Suffolk, which all generate rent for Medway council, will additionally be sold under the plan.
Council Tax Rises and Broader Financial Strains
This research of councils in the key cities group, which covers Sunderland, Southampton, Gloucester and Salford, also found that more than 70% of councils will have to raise council taxes next spring to cover the growing cost of essential services, increased rates of housing insecurity, and a longstanding accommodation deficit.
The authority explained it will press ahead with property disposals after steep rises in the cost of children services, support for vulnerable learners, adult social care, and temporary accommodation.
“We are taking innovative approaches but certain measures take time to deliver both better provisions 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 drastic reduction in our revenue support grant from over the past decade, which is very challenging.”
Countrywide Patterns and Projections
Research of county councils recently also found council budgets being stretched by the growing number of young people and older individuals 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 manage increased demand.
Ministers have delayed scheduled changes to the Send system until the coming year after a policy document setting out those reforms has been postponed.
Deprivation and Financial Shortfalls
According to the most recent indices of deprivation (the Index of Multiple Deprivation) covering UK local authorities, many key cities members were included in the most disadvantaged in England.
- “Member cities like several major towns rank in the top 30 nationally under the latest deprivation indices,” said the report.
“While only a single urban area is among the top 10 for deprived neighbourhoods nationally, cities are far more likely to be in the worst-off 20% of England. The figures highlights the extent of difficulties confronting municipal officials across key cities in the coming year,” the report added.
“Council officials have been explicit about the necessity for a equitable and lasting funding system that reflects and responds to the real levels of deprivation and need,” stated Michael Mordey.
“Without this, councils will persist to face impossible choices around which essential services to allocate spend to, and which to cut, to the detriment of their residents.”
A fifth of councils have cut or compromised care services in the past 12 months, the study found.
