According to a recent poll of local authorities, English councils are planning to sell community centers, sports centres, and shopping arcades as they rely on a rapid disposal of properties to balance the books.
Growing Fiscal Pressures Drive Asset Sales
A coalition of councils representing second-tier cities in the UK stated that six out of ten of local authorities are planning to dispose of properties to cover the escalating costs of social services for vulnerable individuals.
Local governments have in the past come under fire for selling public land and land to shore up their budgets, but they argue they must continue to raise vital cash from property disposals or face insolvency.
The group noted that a high proportion of authorities attempting to raise money from a quick sale of holdings represented “a distinct shift from 2024, when the largest share (60%) of local leaders stated they would focus on restructuring services and using savings to weather growing fiscal pressures.”
Specific Examples of Proposed Sales
Medway Council in Kent said its asset disposal plan included the sale of a shopping centre in a local town and a social club in another town to generate 20 million pounds over five years.
- A local golf course and commercial properties held in two English counties, which all provide rental income for Medway council, will additionally be sold under the strategy.
Local Levy Rises and Wider Fiscal Strains
The survey of local authorities in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, also found that over seven in ten of councils will have to increase council taxes next spring to address the growing cost of essential services, increased rates of housing insecurity, and a persistent accommodation deficit.
Medway council explained it will proceed with asset sales after steep rises in the cost of youth support, special educational needs and disability (Send) provision, adult social care, and temporary accommodation.
“We are adopting creative strategies but certain measures take time to deliver both better provisions and financial savings,” said a council leader.
He added: “We face demographic pressures which will persist to increase the strains 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.”
National Trends and Projections
Research of regional authorities recently also found local finances being strained by the growing number of young people and adults requiring Send support.
The County Councils Network said that local shortfalls will hit £4.4bn a year by 2029, as they grapple to manage rising needs.
Ministers have put off scheduled changes to the special educational needs framework until the coming year after a policy document setting out those changes was recently delayed.
Deprivation and Funding Shortfalls
Based on the most recent indices of deprivation (the Index of Multiple Deprivation) covering UK local authorities, many participating urban areas were included in the most disadvantaged in England.
- “Participating urban centers like several major towns place in the most deprived 30 nationally under the latest IMD measures,” said the report.
“While only a single urban area is among the top 10 for disadvantaged communities nationally, cities are much more prone to be in the most deprived fifth of the nation. The figures highlights the scale of challenges facing municipal officials across key cities in the next twelve months,” the analysis added.
“Local government leaders have been clear about the necessity for a fair and sustainable financial structure that accounts for and responds to the actual extent of disadvantage and need,” said Michael Mordey.
“Without this, councils will persist to face impossible choices around which essential services to fund, and which to reduce, to the disadvantage of their residents.”
A fifth of local authorities have cut or compromised care services in the past 12 months, the survey found.
