According to a latest study of local authorities, UK councils are planning to offload social clubs, sports centres, and retail spaces as they rely on a fire sale of properties to stabilize finances.
Increasing Financial Challenges Prompt Asset Sales
A coalition of councils for major urban areas in England reported that six out of ten of councils are intending to sell assets to cover the escalating 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 budgets, but they contend they must continue to raise vital cash from asset sales or face insolvency.
This coalition said that a significant number of councils attempting to raise money from a fire sale of assets represented “a clear change from 2024, when the majority (60%) of local leaders said they would prioritise service redesigns and using financial reserves to weather growing fiscal pressures.”
Specific Examples of Planned Sales
One local authority in southeast England announced its asset disposal plan featured the disposal of a shopping centre in Rainham and a social club in Rochester to generate 20 million pounds over the next half-decade.
- Gillingham golf club and business parks owned in two English counties, which all provide rental income for the authority, will also be disposed of under the strategy.
Local Levy Increases and Wider Financial Strains
The survey of councils in the key cities group, which includes several urban centers, also found that over seven in ten of councils will need to increase council taxes next April to cover the rising cost of essential services, increased rates of housing insecurity, and a persistent housing shortage.
Medway council 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 short-term housing.
“We are taking innovative approaches but certain measures take time to achieve both better provisions and financial savings,” said a council leader.
He added: “There are demographic pressures which will continue to increase the pressures we have. As a unitary authority, we had a drastic reduction in our revenue support grant from over the past decade, which is very challenging.”
Countrywide Trends and Forecasts
Research of regional authorities this week further found local finances being strained by the growing number of young people and older individuals needing Send support.
A network of councils projected that council deficits will reach £4.4bn a year by 2029, as they struggle to manage rising needs.
Ministers have put off planned reforms to the special educational needs framework until next year after a white paper outlining those changes has been postponed.
Disadvantage and Funding Gaps
Based on the latest indices of deprivation (IMD) covering English councils, many key cities members were among the most deprived in England.
- “Participating urban centers like several major towns place in the top 30 nationally under the 2025 deprivation indices,” said the study.
“While only one key city is among the top 10 for deprived neighbourhoods nationally, urban areas are far more likely to be in the most deprived fifth of England. The data underscores the scale of difficulties facing local leaders across major urban centers in the coming year,” the analysis concluded.
“Local government leaders have been clear about the need for a equitable and lasting funding system that accounts for and addresses the real levels of deprivation and demand,” said Michael Mordey.
“Without this, councils will continue to face impossible choices around which vital provisions to fund, and which to cut, to the disadvantage of their communities.”
A fifth of local authorities have reduced or weakened care services in the last year, the survey revealed.
