According to a latest survey of municipal councils, UK councils are planning to sell community centers, sports centres, and retail spaces as they rely on a fire sale of assets to stabilize finances.
Increasing Financial Challenges Prompt Asset Sales
A coalition of councils representing second-tier cities in the UK stated that 60% of councils are planning to dispose of properties to cover the rising costs of adult and children’s social care.
Local governments have previously faced criticism for disposing of public land and open spaces to shore up their budgets, but they contend they must proceed to raise vital cash from asset sales or face insolvency.
The group said that a high proportion of councils attempting to generate funds from a quick sale of assets represented “a distinct shift from 2024, when the majority (60%) of municipal officials said they would focus on service redesigns and using savings to weather increasing financial challenges.”
Detailed Examples of Proposed Disposals
Medway Council in southeast England announced its property management strategy featured the sale 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 Worcestershire and Suffolk, which all generate rent for Medway council, will also be disposed of under the plan.
Local Levy Rises and Broader Financial Pressures
This research of local authorities in the coalition, which includes Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of councils will need to raise council taxes next April to address the rising cost of core provisions, higher levels of housing insecurity, and a persistent housing shortage.
Medway council explained it will proceed with asset sales after steep rises in the cost of youth support, special educational needs and disability (Send) provision, adult social care, and temporary accommodation.
“We are adopting innovative approaches but certain measures take time to deliver both improved services and financial savings,” said Vince Maple.
He continued: “We face population challenges which will persist to increase the strains we have. As a unitary authority, we had a drastic reduction in our revenue support grant from 2010-24, which is very challenging.”
Countrywide Patterns and Projections
A survey of regional authorities recently further found council budgets being strained by the increasing figures of children and older individuals requiring Send support.
The County Councils Network said that council deficits will hit £4.4bn a year by 2029, as they struggle to cope with rising needs.
Ministers have delayed planned reforms to the special educational needs framework until the coming year after a policy document setting out those changes was recently delayed.
Disadvantage and Financial Shortfalls
Based on the most recent indices of deprivation (IMD) covering English councils, many key cities members were among the most disadvantaged in the country.
- “Participating urban centers like several major towns place in the top 30 across the country under the 2025 IMD measures,” noted the study.
“Although only one key city is in the ten most deprived for deprived neighbourhoods nationally, urban areas are much more prone to be in the most deprived fifth of the nation. The data underscores the scale of difficulties facing municipal officials across major urban centers in the next twelve months,” the analysis added.
“Council officials have been clear about the need for a equitable and lasting financial structure that reflects and responds to the actual extent of deprivation and need,” stated Michael Mordey.
“Without this, councils will persist to face impossible choices around which vital provisions to allocate spend to, and which to reduce, to the disadvantage of their residents.”
One in five of local authorities have cut or compromised care services in the past 12 months, the study found.
