Based on a new survey of municipal councils, English councils are planning to sell community centers, athletic facilities, and shopping arcades as they bet on a rapid disposal of properties to stabilize finances.
Increasing Financial Pressures Drive Asset Sales
The Key Cities Group representing major urban areas in the UK reported that 60% of councils are planning to sell assets to cover the escalating costs of social services for vulnerable individuals.
Councils have previously come under fire for disposing of playing fields and open spaces to support their budgets, but they argue they must proceed to raise vital cash from property disposals or declare themselves bankrupt.
The group noted that a significant number of councils seeking to generate funds from a quick sale of assets represented “a clear change from 2024, when the largest share (60%) of local leaders said they would prioritise restructuring services and using financial reserves to weather increasing fiscal pressures.”
Specific Examples of Proposed Sales
One local authority in southeast England said its property management strategy included the sale of a retail complex in Rainham and a community venue in Rochester to raise 20 million pounds over the next half-decade.
- Gillingham golf club and commercial properties held in two English counties, which all provide rental income for Medway council, will additionally be sold under the plan.
Local Levy Rises and Broader Financial Strains
This research of local authorities in the key cities group, which includes several urban centers, further found that more than 70% of authorities will have to increase council taxes next April to address the growing cost of core provisions, higher levels of homelessness, and a persistent housing shortage.
The authority explained it will proceed with property disposals after sharp increases in the cost of children services, special educational needs and disability (Send) provision, adult social care, and temporary accommodation.
“We are taking innovative approaches but some of these take time to deliver both improved services and cost efficiency,” said a council leader.
He continued: “There are population challenges which will continue to add to the pressures we have. As a unitary authority, we had a 91% cut in our revenue support grant from over the past decade, which is extremely difficult.”
National Trends and Forecasts
A survey of county councils this week also found local finances being stretched by the growing number of children and older individuals needing Send support.
A network of councils said that local shortfalls will hit £4.4bn a year by 2029, as they struggle to manage increased demand.
Government officials have delayed planned reforms to the Send system until next year after a white paper setting out those changes has been postponed.
Disadvantage and Financial Gaps
According to the latest deprivation measures (IMD) covering UK local authorities, several key cities members were among the most deprived in the country.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the top 30 nationally under the latest deprivation indices,” noted the report.
“Although only one key city is in the top 10 for deprived neighbourhoods countrywide, urban areas are much more prone to be in the most deprived fifth of England. The data underscores the extent of difficulties facing local leaders across major urban centers in the next twelve months,” the report concluded.
“Council officials have been clear about the need for a equitable and lasting funding system that reflects and responds to the actual extent of deprivation and need,” said a council leader.
“Lacking this, local authorities will continue to face impossible choices around which essential services to allocate spend to, and which to cut, to the disadvantage of their residents.”
A fifth of local authorities have reduced or weakened care services in the past 12 months, the survey found.
