According to a latest survey of municipal councils, English councils are preparing to offload social clubs, sports centres, and retail spaces as they rely on a rapid disposal of assets to stabilize finances.
Growing Fiscal Pressures Drive Asset Sales
A coalition of councils representing second-tier cities in England stated 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 previously faced criticism for selling public land and open spaces to shore up their budgets, but they contend they must continue to raise vital cash from asset sales or face insolvency.
This coalition noted that a high proportion of councils attempting to raise money from a quick sale of assets represented “a clear change from 2024, when the largest share (60%) of local leaders stated they would prioritise restructuring services and using financial reserves to manage growing financial challenges.”
Specific Examples of Proposed Sales
One local authority in Kent announced its asset disposal plan included the disposal of a retail complex in a local town and a social club in Rochester to generate 20 million pounds over the next half-decade.
- A local golf course and commercial properties owned in Worcestershire and Suffolk, which all provide rental income for Medway council, will also be disposed of under the plan.
Council Tax Increases and Wider Financial Pressures
The survey of local authorities in the coalition, which covers several urban centers, also found that over seven in ten of authorities will need to raise local levies next spring to address the rising cost of essential services, increased rates of housing insecurity, and a longstanding housing shortage.
The authority said it will proceed with asset sales after sharp increases in the cost of children services, support for vulnerable learners, elderly and disability services, and short-term housing.
“We are taking innovative approaches but some of these require time to achieve both better provisions and financial savings,” stated a council leader.
He continued: “There are demographic pressures which will continue to increase the strains we have. As a unitary authority, we had a 91% cut in our central funding from 2010-24, which is extremely difficult.”
National Patterns and Forecasts
Research of regional authorities recently also found council budgets being stretched by the increasing figures of children and adults requiring Send support.
The County Councils Network said that council deficits will reach 4.4 billion pounds a year by 2029, as they struggle to cope with rising needs.
Government officials have delayed planned reforms to the special educational needs framework until the coming year after a white paper outlining those reforms was recently delayed.
Deprivation and Funding Shortfalls
Based on the most recent indices of deprivation (the Index of Multiple Deprivation) covering UK local authorities, several key cities members were included in the most disadvantaged in England.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the top 30 across the country under the latest deprivation indices,” noted the report.
“While only one key city is among the top 10 for deprived neighbourhoods countrywide, urban areas are much more prone to be in the worst-off 20% of the nation. The figures highlights the scale of difficulties facing local leaders across key cities in the coming year,” the report added.
“Local government leaders have been clear about the need for a fair and sustainable financial structure that reflects and addresses the actual extent of disadvantage and demand,” stated Michael Mordey.
“Without this, local authorities will continue to face impossible choices around which vital provisions to allocate spend to, and which to reduce, to the detriment of their communities.”
One in five of local authorities have cut or compromised care services in the past 12 months, the study revealed.
