According to a recent study of municipal councils, English councils are preparing to sell social clubs, sports centres, and shopping arcades as they rely on a fire sale of assets to balance the books.
Increasing Fiscal Pressures Prompt Asset Sales
The Key Cities Group for second-tier cities in England reported that six out of ten of councils are planning to sell assets to cover the rising costs of adult and children’s social care.
Local governments have in the past faced criticism for disposing of public land and land to shore up their budgets, but they argue they must proceed to generate essential revenue from asset sales or declare themselves bankrupt.
This coalition noted that a significant number of councils seeking to generate funds from a fire sale of assets represented “a distinct shift from 2024, when the majority (six in ten) of local leaders stated they would prioritise service redesigns and using financial reserves to manage increasing financial challenges.”
Detailed Examples of Proposed Sales
One local authority in southeast England said its property management strategy included the sale of a shopping centre in Rainham and a community venue in another town to raise £20m over the next half-decade.
- A local golf course and commercial properties owned in two English counties, which all generate rent for Medway council, will also be disposed of under the strategy.
Local Levy Increases and Wider Fiscal Pressures
This research of local authorities in the key cities group, which covers several urban centers, further found that over seven in ten of authorities will need to raise local levies next April to cover the rising cost of core provisions, higher levels of housing insecurity, and a longstanding accommodation deficit.
The authority explained it will press ahead 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 certain measures take time to deliver both improved services and financial savings,” stated Vince Maple.
He continued: “We face population challenges which will persist to increase the pressures we have. As a local government body, we had a 91% cut in our central funding from over the past decade, which is extremely difficult.”
Countrywide Trends and Projections
Research of regional authorities this week further found council budgets being strained by the increasing figures of young people and adults needing special educational assistance.
A network of councils projected that local shortfalls will reach 4.4 billion pounds a year by the end of the decade, as they struggle to cope with rising needs.
Ministers have delayed scheduled changes to the special educational needs framework until the coming year after a policy document setting out those changes has been postponed.
Disadvantage and Financial Shortfalls
Based on the latest deprivation measures (the Index of Multiple Deprivation) for UK local authorities, many participating urban areas were included in the most deprived in the country.
- “Member cities like several major towns rank in the top 30 across the country under the 2025 IMD measures,” noted the report.
“Although only a single urban area is among the top 10 for deprived neighbourhoods nationally, urban areas are much more prone to be in the most deprived fifth of England. The figures highlights the scale of challenges facing municipal officials across major urban centers in the coming year,” the analysis concluded.
“Local government leaders have been explicit about the necessity for a fair and sustainable financial structure that accounts for and addresses the real levels of deprivation and demand,” stated a council leader.
“Lacking this, councils will persist to face difficult decisions around which essential services to fund, and which to reduce, to the disadvantage of their residents.”
A fifth of councils have reduced or weakened social care provision in the last year, the study found.
