According to a recent survey of local authorities, English councils are preparing to offload community centers, sports centres, and retail spaces as they bet on a fire sale of assets to stabilize finances.
Growing Financial Challenges Drive 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 cover the rising costs of adult and children’s social care.
Local governments have previously come under fire for disposing of playing fields and land to support their finances, but they contend they must continue to raise vital cash from asset sales or declare themselves bankrupt.
The group said that a significant number of authorities attempting to generate funds from a fire sale of assets represented “a distinct shift from 2024, when the largest share (60%) of local leaders said they would prioritise restructuring services and utilising savings to manage growing financial challenges.”
Specific Cases of Proposed Sales
One local authority in southeast England announced its property management strategy included the sale of a shopping centre in a local town and a social club in another town to raise 20 million pounds over five years.
- Gillingham golf club and business parks owned in Worcestershire and Suffolk, which all provide rental income for Medway council, will additionally be disposed of under the strategy.
Local Levy Rises and Wider Fiscal Pressures
This research of councils in the key cities group, which covers Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of councils will have to increase council taxes next spring to address the rising cost of essential services, increased rates of homelessness, and a persistent housing shortage.
Medway council explained it will proceed with property disposals after sharp increases in the cost of children services, support for vulnerable learners, elderly and disability services, and temporary accommodation.
“We are taking innovative approaches but certain measures take time to deliver both better provisions and financial savings,” said Vince Maple.
He continued: “There are demographic pressures which will persist to add to the strains we have. As a local government body, we had a 91% cut in our revenue support grant from 2010-24, which is very challenging.”
National Patterns and Forecasts
A survey of regional authorities this week further found council budgets being strained by the increasing figures of children and adults needing Send support.
A network of councils projected that local shortfalls will hit 4.4 billion pounds a year by 2029, as they struggle to manage increased demand.
Ministers have delayed planned reforms to the Send system until next year after a white paper outlining those reforms was recently delayed.
Disadvantage and Funding Shortfalls
According to the most recent deprivation measures (the Index of Multiple Deprivation) for English councils, many participating urban areas were included in the most disadvantaged in England.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the most deprived 30 nationally under the 2025 IMD measures,” noted the report.
“While only one key city is among the ten most deprived for disadvantaged communities countrywide, cities are much more prone to be in the worst-off 20% of England. The figures underscores the scale of difficulties confronting municipal officials across major urban centers in the coming year,” the report added.
“Local government leaders have been explicit about the need for a equitable and lasting financial structure that reflects and addresses the actual extent of disadvantage and need,” stated Michael Mordey.
“Without this, councils will persist to face difficult decisions around which essential services to allocate spend to, and which to reduce, to the disadvantage of their communities.”
A fifth of councils have reduced or weakened social care provision in the last year, the survey revealed.
