According to a new study of local authorities, UK councils are planning to sell social clubs, sports centres, and retail spaces as they bet on a fire sale of assets to stabilize finances.
Growing Financial Pressures Prompt Asset Sales
A coalition of councils for 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 public land and open spaces to shore up their finances, but they contend they must continue to raise vital cash from asset sales or declare themselves bankrupt.
The group noted that a significant number 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 said they would focus on restructuring services and using financial reserves to manage increasing fiscal pressures.”
Specific Examples of Proposed Sales
Medway Council in southeast England said its asset disposal plan included the disposal of a shopping centre in Rainham and a community venue in another town to raise £20m over five years.
- Gillingham golf club and business parks owned in Worcestershire and Suffolk, which all generate rent for the authority, will also be disposed of under the strategy.
Local Levy Increases and Wider Financial Strains
The survey of councils in the coalition, which includes several urban centers, further found that more than 70% of authorities will have to increase local levies next April to address the rising cost of core provisions, higher levels of housing insecurity, and a longstanding housing shortage.
The authority explained it will proceed with asset sales after sharp increases in the cost of youth support, 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,” said a council leader.
He continued: “There are population challenges which will continue to increase the strains 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 Forecasts
Research of county councils this week further found council budgets being strained by the growing number of children and older individuals requiring Send support.
A network of councils projected that council deficits will hit £4.4bn a year by the end of the decade, as they grapple to cope with increased demand.
Ministers have delayed planned reforms to the special educational needs framework until next year after a white paper setting out those reforms has been postponed.
Disadvantage and Funding Shortfalls
According to the latest deprivation measures (IMD) for English councils, several participating urban areas were among the most disadvantaged in England.
- “Member cities like several major towns place in the top 30 across the country under the 2025 IMD measures,” noted the study.
“Although only one key city is among the top 10 for deprived neighbourhoods countrywide, cities are much more prone to be in the worst-off 20% of the nation. The figures highlights the scale of challenges confronting local leaders across major urban centers in the next twelve months,” the analysis concluded.
“Council officials have been explicit about the need for a fair and sustainable funding system that accounts for and addresses the real levels of deprivation and need,” said Michael Mordey.
“Without this, local authorities will continue to face difficult decisions around which essential services to allocate spend to, and which to reduce, to the disadvantage of their residents.”
A fifth of councils have reduced or weakened care services in the past 12 months, the survey revealed.
