Based on a latest poll of municipal councils, UK councils are planning to offload community centers, athletic facilities, and shopping arcades as they rely on a rapid disposal of assets to balance the books.
Growing Fiscal Pressures Drive Asset Sales
A coalition of councils for second-tier cities in England reported that six out of ten of local authorities are planning to sell assets to cover the rising costs of social services for vulnerable individuals.
Local governments have in the past come under fire for selling playing fields and open spaces to support their budgets, but they argue they must proceed to raise vital cash from property disposals or face insolvency.
The group said that a high proportion of councils seeking to raise money from a quick sale of assets marked “a distinct shift from 2024, when the largest share (six in ten) of local leaders said they would prioritise restructuring services and utilising savings to manage increasing fiscal pressures.”
Specific Examples of Proposed Disposals
Medway Council in Kent announced its property management strategy featured the disposal of a shopping centre in a local town and a social club in another town to raise 20 million pounds over five years.
- A local golf course and business parks held in Worcestershire and Suffolk, which all generate rent for Medway council, will also be sold under the strategy.
Council Tax Increases and Wider Financial Strains
The survey of councils in the key cities group, which includes several urban centers, also found that more than 70% of councils will need to raise council taxes next spring to address the growing cost of core provisions, increased rates of homelessness, and a longstanding housing shortage.
Medway council 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 adopting innovative approaches but some of these take time to achieve both improved services and cost efficiency,” stated a council leader.
He continued: “We face population challenges which will persist to add to the pressures we have. As a unitary authority, we had a 91% cut in our central funding from over the past decade, which is extremely difficult.”
National Trends and Projections
A survey of regional authorities this week further found council budgets being stretched by the increasing figures of children and adults requiring special educational assistance.
A network of councils said that council deficits will reach £4.4bn a year by the end of the decade, as they struggle to manage rising needs.
Ministers have put off scheduled changes to the Send system until next year after a white paper setting out those changes has been postponed.
Deprivation and Financial Gaps
Based on the latest indices of deprivation (the Index of Multiple Deprivation) covering English councils, several key cities members were included in the most disadvantaged in the country.
- “Participating urban centers like several major towns place in the most deprived 30 across the country under the 2025 deprivation indices,” said the report.
“Although only a single urban area is among the ten most deprived for deprived neighbourhoods countrywide, cities are much more prone to be in the worst-off 20% of England. The figures highlights the extent of difficulties facing local leaders across major urban centers in the coming year,” the report added.
“Local government leaders have been clear about the necessity for a fair and sustainable financial structure that reflects and addresses the real levels of disadvantage and demand,” stated a council leader.
“Lacking this, local authorities will persist to face impossible choices around which essential services to fund, and which to reduce, to the disadvantage of their communities.”
A fifth of councils have reduced or weakened care services in the past 12 months, the study found.
