Based on a latest study of local authorities, UK councils are preparing to offload community centers, sports centres, and shopping arcades as they bet on a rapid disposal of assets to stabilize finances.
Growing Financial Pressures Drive Asset Sales
The Key Cities Group representing major urban areas in the UK reported that six out of ten of councils are intending to dispose of properties to cover the rising costs of adult and children’s social care.
Councils have in the past come under fire for selling playing fields and land to support their finances, but they contend they must continue to generate essential revenue from property disposals or declare themselves bankrupt.
This coalition said that a significant number of authorities attempting to generate funds from a fire sale of assets marked “a clear change from 2024, when the majority (six in ten) of municipal officials said they would prioritise service redesigns and utilising savings to manage growing financial challenges.”
Specific Examples of Proposed Sales
Medway Council in Kent announced its asset disposal plan included the disposal of a retail complex 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 two English counties, which all provide rental income for Medway council, will also be disposed of under the plan.
Local Levy Increases and Wider Fiscal Strains
This research of councils in the coalition, which includes Sunderland, Southampton, Gloucester and Salford, also found that more than 70% of councils will need to increase local levies next April to address the rising cost of essential services, increased rates of housing insecurity, and a longstanding housing shortage.
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, elderly and disability services, and temporary accommodation.
“We are adopting creative strategies but certain measures require time to achieve both improved services and financial savings,” said a council leader.
He continued: “There are demographic pressures which will continue to increase the strains we have. As a local government body, we had a 91% cut in our revenue support grant from 2010-24, which is very challenging.”
Countrywide Trends and Forecasts
A survey of regional authorities this week further found council budgets being strained by the increasing figures of children and older individuals requiring Send support.
A network of councils said that council deficits will reach 4.4 billion pounds a year by 2029, as they struggle to cope with rising needs.
Ministers have put off scheduled changes 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 latest indices of deprivation (the Index of Multiple Deprivation) for UK local authorities, many participating urban areas were among the most deprived in England.
- “Member cities like several major towns place in the top 30 nationally under the 2025 IMD measures,” said the study.
“While only one key city is in the top 10 for disadvantaged communities countrywide, cities are much more prone to be in the most deprived fifth of England. The data highlights the scale of difficulties confronting local leaders across key cities in the next twelve months,” the report added.
“Local government leaders have been clear about the need for a fair and sustainable financial structure that accounts for and addresses the actual extent of disadvantage and need,” said a council leader.
“Without this, local authorities will persist to face difficult decisions around which essential services to allocate spend to, and which to reduce, to the detriment of their residents.”
One in five of councils have cut or compromised social care provision in the past 12 months, the study found.
