Based on a new survey of local authorities, UK councils are preparing to sell social clubs, sports centres, and shopping arcades as they bet on a fire sale of properties to stabilize finances.
Growing Fiscal Challenges Drive Asset Sales
A coalition of councils for major urban areas in the UK stated that six out of ten of councils are planning to dispose of properties to meet the rising costs of adult and children’s social care.
Councils have in the past come under fire for disposing of public land and open spaces 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 high proportion of councils attempting to generate funds from a quick sale of assets marked “a clear change from 2024, when the majority (six in ten) of local leaders said they would prioritise restructuring services and using savings to manage growing fiscal pressures.”
Specific Cases of Proposed Disposals
One local authority in southeast England announced its property management strategy featured 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.
- Gillingham golf club and commercial properties held in Worcestershire and Suffolk, which all provide rental income for Medway council, will additionally be disposed of under the strategy.
Council Tax Increases and Wider Financial Strains
This research of local authorities in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of councils will need to raise local levies next April to cover the rising cost of core provisions, higher levels of homelessness, and a longstanding accommodation deficit.
Medway council said it will press ahead with property disposals after steep rises in the cost of youth support, special educational needs and disability (Send) provision, adult social care, and short-term housing.
“We are adopting innovative approaches but some of these take time to deliver both improved services and cost efficiency,” said Vince Maple.
He added: “There are population challenges which will continue to increase the strains we have. As a unitary authority, we had a 91% cut in our revenue support grant from 2010-24, which is very challenging.”
National Trends and Forecasts
A survey of regional authorities this week also found local finances being stretched by the increasing figures of children and adults requiring special educational assistance.
The County Councils Network said that council deficits will reach £4.4bn a year by the end of the decade, as they grapple to cope with increased demand.
Ministers have put off scheduled changes to the special educational needs framework until the coming year after a white paper setting out those reforms has been postponed.
Deprivation and Funding Shortfalls
According to the latest indices of deprivation (IMD) covering English councils, several participating urban areas were included in the most deprived in England.
- “Participating urban centers like several major towns place in the most deprived 30 across the country under the 2025 IMD measures,” said the study.
“While only one key city is in the ten most deprived for disadvantaged communities nationally, urban areas are far more likely to be in the worst-off 20% of England. The data underscores the extent of difficulties facing local leaders 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 funding system that accounts for and responds to the actual extent of disadvantage and need,” said a council leader.
“Lacking this, local authorities will persist to face impossible choices around which essential services to allocate spend to, and which to cut, to the disadvantage of their communities.”
One in five of local authorities have cut or compromised social care provision in the past 12 months, the study revealed.
