According to a new poll of municipal councils, English councils are planning to sell community centers, athletic facilities, and shopping arcades as they bet on a fire sale of assets to balance the books.
Increasing Financial Pressures Drive Asset Sales
The Key Cities Group representing second-tier cities in the UK reported that six out of ten of local authorities are planning to sell assets to cover the rising costs of adult and children’s social care.
Councils have in the past come under fire for disposing of playing fields and open spaces to shore up their finances, but they contend they must continue to generate essential revenue from property disposals or face insolvency.
This coalition said that a high proportion of councils attempting to raise money from a quick sale of holdings represented “a clear change from 2024, when the largest share (60%) of local leaders said they would prioritise service redesigns and utilising financial reserves to manage increasing fiscal pressures.”
Specific Cases of Proposed Sales
Medway Council in Kent said its property management strategy featured the disposal of a shopping centre in Rainham and a community venue in another town to generate 20 million pounds over five years.
- Gillingham golf club and commercial properties held in two English counties, which all provide rental income for the authority, will also be sold under the plan.
Council Tax Rises and Wider Financial Pressures
The survey of local authorities in the coalition, which includes several urban centers, further found that over seven in ten of authorities will need to increase council taxes next spring to address the growing cost of essential services, increased rates of homelessness, and a longstanding housing shortage.
Medway council explained it will press ahead with asset sales after steep rises in the cost of children services, special educational needs and disability (Send) provision, elderly and disability services, and temporary accommodation.
“We are taking innovative approaches but some of these require time to deliver both improved services and financial savings,” stated Vince Maple.
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 also found local finances being stretched by the growing number of young people and adults needing Send support.
A network of councils said that council deficits will reach 4.4 billion pounds a year by 2029, as they grapple to manage increased demand.
Government officials have put off scheduled changes to the special educational needs framework until next year after a policy document setting out those changes has been postponed.
Deprivation and Financial Gaps
Based on the latest deprivation measures (IMD) for English councils, many key cities members were among the most disadvantaged in England.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the most deprived 30 across the country under the latest deprivation indices,” said the report.
“Although only a single urban area is in the top 10 for deprived neighbourhoods countrywide, urban areas are far more likely to be in the most deprived fifth of England. The figures highlights the scale of challenges facing local leaders across major urban centers in the next twelve months,” the report added.
“Council officials have been explicit about the need for a fair and sustainable financial structure that reflects and responds to the actual extent of deprivation and need,” said Michael Mordey.
“Lacking this, councils 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 social care provision in the past 12 months, the survey revealed.
