According to a latest survey of municipal councils, English councils are planning to sell community centers, sports centres, and retail spaces as they rely on a fire sale of assets to balance the books.
Increasing Fiscal Challenges Prompt Asset Sales
The Key Cities Group representing second-tier cities in the UK stated that 60% of local authorities are intending to sell assets to meet the rising costs of social services for vulnerable individuals.
Local governments have in the past come under fire for selling playing fields and open spaces to shore up their finances, but they argue they must continue to raise vital cash from property disposals or declare themselves bankrupt.
The group noted that a high proportion of councils seeking to raise money from a quick sale of holdings represented “a clear change from 2024, when the majority (six in ten) of local leaders stated they would prioritise service redesigns and utilising savings to manage increasing fiscal pressures.”
Specific Examples of Proposed Sales
Medway Council in southeast England announced its asset disposal plan included the sale of a shopping centre in a local town and a community venue in another town to raise 20 million pounds over five years.
- Gillingham golf club and business parks owned in two English counties, which all generate rent for Medway council, will additionally be disposed of under the strategy.
Council Tax Rises and Broader Financial Strains
This research of local authorities in the coalition, which covers several urban centers, further found that over seven in ten of councils will need to increase local levies next April to address the rising cost of core provisions, higher levels of housing insecurity, and a longstanding housing shortage.
Medway council said it will proceed with asset sales after sharp increases in the cost of youth support, support for vulnerable learners, adult social care, and short-term housing.
“We are taking innovative approaches but some of these require time to deliver both better provisions and cost efficiency,” stated a council leader.
He continued: “There are demographic pressures which will persist to increase the strains we have. As a unitary authority, we had a drastic reduction in our central funding from over the past decade, which is very challenging.”
National Patterns and Forecasts
A survey of regional authorities this week further found local finances being stretched by the increasing figures of children and adults needing Send support.
A network of councils projected that council deficits will hit 4.4 billion pounds a year by 2029, as they struggle to cope with 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 Shortfalls
Based on the most recent indices of deprivation (the Index of Multiple Deprivation) for UK local authorities, many key cities members were among the most deprived in England.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the top 30 across the country under the 2025 IMD measures,” said the study.
“Although only a single urban area is among the ten most deprived for disadvantaged communities countrywide, cities are far more likely to be in the worst-off 20% of the nation. The figures underscores the scale of difficulties confronting municipal officials across key cities in the next twelve months,” the report concluded.
“Council officials have been explicit about the necessity for a fair and sustainable financial structure that reflects and addresses the real levels of deprivation and demand,” said Michael Mordey.
“Without this, local authorities will persist to face difficult decisions around which vital provisions to allocate spend to, and which to cut, to the detriment of their communities.”
One in five of local authorities have cut or compromised social care provision in the past 12 months, the survey found.
