According to a new poll of local authorities, English councils are planning to sell social clubs, sports centres, and shopping arcades as they rely on a rapid disposal of properties to stabilize finances.
Growing Financial Pressures Drive Asset Sales
The Key Cities Group representing second-tier cities in England stated that 60% of local authorities are planning to sell assets to meet the escalating costs of adult and children’s social care.
Councils have previously come under fire for selling public land and land to shore up their finances, but they argue they must proceed to generate essential revenue from asset sales or face insolvency.
The group said that a high proportion of authorities attempting to generate funds from a quick sale of holdings represented “a clear change from 2024, when the largest share (60%) of municipal officials stated they would focus on service redesigns and using savings to manage increasing fiscal pressures.”
Detailed Examples of Planned Sales
Medway Council in Kent announced its asset disposal plan included the disposal of a retail complex in a local town and a social club in another town to generate £20m over the next half-decade.
- Gillingham golf club and commercial properties held in two English counties, which all provide rental income for Medway council, will additionally be sold under the plan.
Local Levy Increases and Broader Fiscal Pressures
The survey of local authorities in the key cities group, which covers Sunderland, Southampton, Gloucester and Salford, also found that more than 70% of authorities will need to increase local levies next spring to address the growing cost of core provisions, higher levels of housing insecurity, and a longstanding accommodation deficit.
Medway council explained it will proceed with asset sales after sharp increases in the cost of children services, support for vulnerable learners, elderly and disability services, and short-term housing.
“We are adopting innovative approaches but certain measures take time to achieve both better provisions and cost efficiency,” said a council leader.
He added: “We face demographic pressures which will persist to add to the pressures we have. As a unitary authority, we had a drastic reduction in our central funding from 2010-24, which is very challenging.”
Countrywide Trends and Projections
Research of county councils recently also found local finances being strained by the increasing figures of children and older individuals needing special educational assistance.
A network of councils projected that council deficits will hit £4.4bn a year by 2029, as they grapple to manage rising needs.
Ministers have delayed planned reforms to the Send system until next year after a policy document setting out those reforms has been postponed.
Disadvantage and Financial Shortfalls
Based on the latest indices of deprivation (the Index of Multiple Deprivation) covering UK local authorities, several participating urban areas were among the most disadvantaged in the country.
- “Participating urban centers like several major towns place in the most deprived 30 nationally under the latest IMD measures,” said the study.
“Although only one key city is in the top 10 for disadvantaged communities nationally, cities are much more prone to be in the most deprived fifth of the nation. The data underscores the extent of challenges facing local leaders across major urban centers in the next twelve months,” the report concluded.
“Council officials have been clear about the need for a equitable and lasting financial structure that reflects and responds to the real levels of disadvantage and demand,” stated a council leader.
“Without this, councils will persist to face difficult decisions around which essential services to allocate spend to, and which to reduce, to the detriment of their residents.”
One in five of local authorities have cut or compromised care services in the last year, the study revealed.
