🔗 Share this article

Based on a new survey of local authorities, English councils are planning to sell community centers, athletic facilities, and retail spaces as they rely on a rapid disposal of assets to stabilize finances.

Growing Fiscal Pressures Drive Asset Sales

The Key Cities Group for major urban areas in the UK reported that 60% of local authorities are intending to sell assets to cover the escalating costs of social services for vulnerable individuals.

Local governments have in the past faced criticism for disposing of playing fields 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.

This coalition said that a significant number of councils seeking to raise money from a quick sale of assets represented “a clear change from 2024, when the largest share (six in ten) of local leaders stated they would focus on restructuring services and utilising savings to manage growing financial challenges.”

Specific Examples of Proposed Sales

Medway Council in southeast England announced its asset disposal plan included the sale of a retail complex in a local town and a community venue in another town to raise £20m over the next half-decade.

• Gillingham golf club and business parks held in Worcestershire and Suffolk, which all generate rent for the authority, will additionally be disposed of under the plan.

Council Tax Increases and Broader Financial Pressures

The survey of councils in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of authorities will need to increase local levies next April to address the growing cost of core provisions, increased rates of homelessness, and a persistent accommodation deficit.

Medway council said it will press ahead with property disposals after steep rises in the cost of children services, support for vulnerable learners, adult social care, and temporary accommodation.

“We are taking innovative approaches but some of these require time to deliver both improved services and cost efficiency,” said a council leader.

He continued: “There are demographic pressures which will continue to add to the pressures we have. As a unitary authority, we had a drastic reduction in our revenue support grant from 2010-24, which is very challenging.”

Countrywide Patterns and Forecasts

A survey of regional authorities this week further found local finances being strained by the growing number of young people and adults requiring special educational assistance.

The County Councils Network said that council deficits will hit 4.4 billion pounds a year by the end of the decade, as they grapple to manage rising needs.

Ministers have delayed planned reforms to the special educational needs framework until next year after a policy document outlining those reforms was recently delayed.

Disadvantage and Funding Gaps

According to the most recent indices of deprivation (the Index of Multiple Deprivation) for English councils, several participating urban areas were among the most disadvantaged in England.

• “Participating urban centers like several major towns place in the top 30 nationally under the latest deprivation indices,” noted the study.

“While only a single urban area is among the ten most deprived for disadvantaged communities nationally, urban areas are far more likely to be in the most deprived fifth of England. The data underscores the scale of challenges facing municipal officials across key cities in the next twelve months,” the report added.

“Council officials have been clear about the necessity for a fair and sustainable financial structure that reflects and responds to the real levels of disadvantage and need,” stated a council leader.

“Without this, local authorities will continue to face difficult decisions around which vital provisions to allocate spend to, and which to reduce, to the disadvantage of their communities.”

One in five of councils have reduced or weakened care services in the last year, the survey revealed.