Based on a latest poll of local authorities, English councils are planning to offload community centers, sports centres, and shopping arcades as they rely on a fire sale of assets to balance the books.
Growing Fiscal Challenges Prompt Asset Sales
A coalition of councils representing second-tier cities in the UK reported that six out of ten of councils are intending to dispose of properties to meet the rising costs of social services for vulnerable individuals.
Local governments have in the past faced criticism for disposing of public land and land to support their finances, but they argue they must continue to raise vital cash from asset sales or face insolvency.
This coalition said that a significant number of authorities seeking to generate funds from a fire sale of holdings represented “a distinct shift from 2024, when the majority (six in ten) of local leaders stated they would focus on service redesigns and using savings to weather increasing financial challenges.”
Detailed Cases of Proposed Sales
One local authority in southeast England said its asset disposal plan included the disposal of a retail complex in a local town and a social club in another town to raise 20 million pounds over five years.
- A local golf course and commercial properties owned in two English counties, which all provide rental income for Medway council, will also be disposed of under the plan.
Local Levy Rises and Broader Financial Strains
The survey of councils in the coalition, which includes Sunderland, Southampton, Gloucester and Salford, also found that more than 70% of councils will have to raise local levies next spring to address the rising cost of essential services, higher levels of homelessness, and a longstanding accommodation deficit.
Medway council explained it will proceed with property disposals after sharp increases in the cost of children services, support for vulnerable learners, adult social care, and temporary accommodation.
“We are adopting innovative approaches but certain measures require time to achieve both better provisions and financial savings,” stated Vince Maple.
He added: “There are demographic pressures which will persist to add to the strains 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 Forecasts
A survey of county councils this week also found council budgets being strained by the growing number of children and adults needing special educational assistance.
The County Councils Network projected that local shortfalls will hit £4.4bn a year by 2029, as they grapple to manage rising needs.
Government officials have put off scheduled changes to the special educational needs framework until next year after a policy document outlining those reforms has been postponed.
Deprivation and Funding Shortfalls
According to the most recent indices of deprivation (the Index of Multiple Deprivation) for English councils, many key cities members were included in the most deprived in the country.
- “Member cities like several major towns rank in the top 30 nationally under the 2025 deprivation indices,” said the report.
“Although only one key city is among the ten most deprived for deprived neighbourhoods nationally, cities are far more likely to be in the worst-off 20% of the nation. The figures underscores the scale of challenges facing local leaders across major urban centers in the next twelve months,” the report concluded.
“Local government leaders have been explicit about the necessity for a fair and sustainable funding system that reflects and addresses the real levels of deprivation and demand,” stated Michael Mordey.
“Without this, local authorities will continue to face difficult decisions around which essential services to fund, and which to reduce, to the disadvantage of their residents.”
One in five of councils have reduced or weakened care services in the last year, the survey revealed.
