According to a recent survey of local authorities, English councils are preparing to sell community centers, sports centres, and retail spaces as they rely on a fire sale of assets to stabilize finances.
Growing Financial Challenges Prompt Asset Sales
The Key Cities Group representing major urban areas in the UK reported that 60% of councils are planning to dispose of properties to cover the escalating costs of social services for vulnerable individuals.
Councils have previously come under fire for disposing of public land and open spaces to shore up their budgets, but they contend they must continue to raise vital cash from asset sales or declare themselves bankrupt.
This coalition said that a high proportion of councils seeking to raise money from a fire sale of assets represented “a distinct shift from 2024, when the majority (six in ten) of municipal officials stated they would prioritise restructuring services and using savings to manage increasing financial challenges.”
Specific Examples of Planned Sales
Medway Council in southeast England said its asset disposal plan included the disposal of a retail complex in a local town and a community venue in another town to raise 20 million pounds over five years.
- A local golf course and commercial properties owned in Worcestershire and Suffolk, which all provide rental income for Medway council, will additionally be disposed of under the strategy.
Local Levy Increases and Broader Financial Strains
The survey of councils in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, also found that more than 70% of councils will have to raise council taxes next spring to cover the growing cost of essential services, higher levels of homelessness, and a longstanding housing shortage.
The authority said it will proceed with property disposals after sharp increases in the cost of youth support, support for vulnerable learners, adult social care, and temporary accommodation.
“We are taking innovative approaches but certain measures take time to deliver both better provisions and cost efficiency,” stated Vince Maple.
He continued: “There are population challenges 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 Patterns and Projections
A survey of county councils this week also found local finances being strained by the increasing figures of young people and older individuals requiring Send support.
The County Councils Network said that council deficits will hit £4.4bn a year by the end of the decade, as they grapple to manage increased demand.
Ministers have put off scheduled changes to the Send system until the coming year after a policy document setting out those changes was recently delayed.
Disadvantage and Funding Gaps
Based on the latest indices of deprivation (the Index of Multiple Deprivation) covering UK local authorities, many key cities members were among the most deprived in the country.
- “Member cities like several major towns place in the most deprived 30 nationally under the 2025 deprivation indices,” noted the report.
“While only one key city is among the top 10 for deprived neighbourhoods nationally, cities are far more likely to be in the worst-off 20% of England. The data highlights the scale of difficulties confronting municipal officials across key cities in the next twelve months,” the analysis concluded.
“Council officials have been clear about the necessity for a equitable and lasting funding system that reflects and responds to the real levels of disadvantage and demand,” said a council leader.
“Lacking this, councils will continue to face difficult decisions around which vital provisions to allocate spend to, and which to reduce, to the disadvantage of their communities.”
One in five of councils have cut or compromised social care provision in the past 12 months, the survey found.
