According to a latest survey of municipal councils, English councils are planning to sell social clubs, athletic facilities, and retail spaces as they rely on a rapid disposal of properties to balance the books.
Growing Fiscal Pressures Prompt Asset Sales
The Key Cities Group representing second-tier cities in the UK stated that six out of ten of councils are intending to sell assets to meet the rising costs of social services for vulnerable individuals.
Local governments have previously come under fire for selling playing fields and land to support their budgets, but they argue they must continue to raise vital cash from asset sales or declare themselves bankrupt.
This coalition said that a significant number of councils attempting to generate funds from a fire sale of holdings represented “a clear change from 2024, when the largest share (60%) of municipal officials stated they would prioritise restructuring services and using financial reserves to manage increasing financial challenges.”
Specific Examples of Planned Sales
Medway Council in Kent announced its asset disposal plan included the sale of a retail complex in a local town and a social club in another town to raise £20m over the next half-decade.
- Gillingham golf club and business parks held in two English counties, which all generate rent for Medway council, will also be sold under the strategy.
Local Levy Rises and Wider Financial Pressures
The survey of councils in the coalition, which includes Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of authorities will need to raise council taxes next April to cover the growing cost of core provisions, increased rates of homelessness, and a persistent accommodation deficit.
The authority said it will proceed with asset sales after sharp increases in the cost of children services, special educational needs and disability (Send) provision, elderly and disability services, and temporary accommodation.
“We are taking innovative approaches but certain measures require time to deliver both better provisions and financial savings,” stated a council leader.
He continued: “There are demographic pressures which will persist to add to the pressures we have. As a unitary authority, we had a 91% cut in our central funding from 2010-24, which is very challenging.”
Countrywide Patterns and Forecasts
A survey of regional authorities this week also found local finances being strained by the growing number of young people and older individuals requiring special educational assistance.
The County Councils Network said that council deficits will reach 4.4 billion pounds a year by the end of the decade, as they grapple to manage rising needs.
Government officials have put off planned reforms to the Send system until the coming year after a white paper setting out those changes has been postponed.
Deprivation and Financial Gaps
According to the latest deprivation measures (the Index of Multiple Deprivation) for English councils, several key cities members were among the most deprived in the country.
- “Participating urban centers like several major towns rank in the most deprived 30 across the country under the latest deprivation indices,” noted the report.
“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 most deprived fifth of the nation. The figures underscores the scale of challenges facing local leaders across key cities in the next twelve months,” the report concluded.
“Local government leaders have been explicit about the need for a equitable and lasting financial structure that accounts for and responds to the real levels of disadvantage and demand,” said Michael Mordey.
“Lacking this, councils will persist to face impossible choices around which essential services to fund, and which to cut, to the detriment of their communities.”
A fifth of local authorities have reduced or weakened care services in the past 12 months, the study found.
