According to a new survey of local authorities, UK councils are planning to offload social clubs, sports centres, and shopping arcades as they rely on a fire sale of assets to stabilize finances.
Increasing Financial Challenges Prompt Asset Sales
A coalition of councils for second-tier cities in England reported that 60% of councils are planning to dispose of properties to cover the escalating costs of social services for vulnerable individuals.
Councils have previously come under fire for disposing of public land and land to support their budgets, but they contend they must proceed to generate essential revenue from property disposals or declare themselves bankrupt.
The group noted that a high proportion of councils attempting to generate funds from a quick sale of assets marked “a distinct shift from 2024, when the majority (six in ten) of local leaders said they would prioritise service redesigns and using savings to manage growing financial challenges.”
Specific Examples of Planned Sales
Medway Council in Kent announced its property management strategy featured the sale of a retail complex in a local town and a community venue in Rochester to raise 20 million pounds over five years.
- A local golf course and business parks owned in Worcestershire and Suffolk, which all provide rental income for the authority, will additionally be sold under the plan.
Local Levy Increases and Wider Financial Strains
The survey of councils in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, also found that more than 70% of councils will have to raise council taxes next spring to cover the growing cost of core provisions, increased rates of homelessness, and a persistent housing shortage.
Medway council said it will press ahead with property disposals after sharp increases in the cost of children services, support for vulnerable learners, elderly and disability services, and short-term housing.
“We are taking creative strategies but certain measures require time to achieve both improved services and cost efficiency,” said Vince Maple.
He continued: “We face demographic pressures which will continue to add to 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.”
Countrywide Trends and Forecasts
A survey of regional authorities recently also found council budgets being stretched by the increasing figures of young people and older individuals requiring special educational assistance.
The County Councils Network projected that council deficits will hit 4.4 billion pounds a year by 2029, as they grapple to cope with rising needs.
Government officials have delayed planned reforms to the Send system until the coming year after a white paper outlining those changes has been postponed.
Disadvantage and Funding Shortfalls
According to the most recent indices of deprivation (IMD) covering English councils, many participating urban areas were included in the most deprived in England.
- “Member cities like several major towns rank in the most deprived 30 nationally under the 2025 IMD measures,” said the report.
“While only one key city is in the ten most deprived for deprived neighbourhoods countrywide, urban areas are far more likely to be in the worst-off 20% of England. The data highlights the scale of challenges facing local leaders across key cities in the next twelve months,” the analysis added.
“Council officials have been clear about the need for a fair and sustainable funding system that reflects and responds to the real levels of disadvantage and need,” said a council leader.
“Without this, councils will continue to face difficult decisions around which essential services to fund, and which to cut, to the detriment of their residents.”
One in five of local authorities have reduced or weakened care services in the past 12 months, the study revealed.
