According to a new poll of municipal councils, UK councils are preparing to sell community centers, athletic facilities, and retail spaces as they rely on a rapid disposal of assets to balance the books.
Increasing Fiscal Challenges Drive Asset Sales
The Key Cities Group representing second-tier cities in England stated that six out of ten of councils are planning to sell assets to cover the rising costs of social services for vulnerable individuals.
Councils have in the past faced criticism for disposing of public land and land to support their budgets, but they argue they must proceed to generate essential revenue from property disposals or declare themselves bankrupt.
The group said that a significant number of councils seeking to generate funds from a fire sale of holdings marked “a distinct shift from 2024, when the majority (60%) of local leaders stated they would prioritise restructuring services and utilising savings to manage increasing fiscal pressures.”
Detailed Examples of Planned Sales
Medway Council in Kent said its asset disposal plan included the sale of a retail complex in a local town and a community venue in another town to generate 20 million pounds over five years.
- Gillingham golf club and business parks owned in two English counties, which all generate rent for the authority, will also be disposed of under the strategy.
Council Tax Increases and Wider Financial Pressures
This research of councils in the key cities group, which includes several urban centers, further found that more than 70% of authorities will have to raise local levies next April to address the growing cost of core provisions, increased rates of homelessness, and a longstanding housing shortage.
The authority said 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 short-term housing.
“We are adopting innovative approaches but some of these take time to achieve both improved services and cost efficiency,” stated a council leader.
He continued: “There are demographic pressures which will persist to add to the pressures we have. As a unitary authority, we had a drastic reduction in our revenue support grant from over the past decade, which is extremely difficult.”
National Trends and Forecasts
Research of county councils this week also found local finances being stretched by the growing number of young people and older individuals needing Send support.
The County Councils Network projected that council deficits will hit £4.4bn a year by the end of the decade, as they grapple to manage increased demand.
Government officials have put off planned reforms to the Send system until next year after a policy document setting out those reforms has been postponed.
Disadvantage and Financial Shortfalls
According to the most recent indices of deprivation (IMD) covering UK local authorities, many key cities members were included in the most disadvantaged in England.
- “Participating urban centers like several major towns place in the top 30 nationally under the 2025 IMD measures,” said the report.
“While only a single urban area is in the ten most deprived for disadvantaged communities nationally, urban areas are much more prone to be in the most deprived fifth of England. The data highlights the scale of difficulties facing municipal officials across major urban centers in the next twelve months,” the analysis added.
“Local government leaders have been explicit about the necessity for a fair and sustainable financial structure that accounts for and responds to the real levels of deprivation and demand,” said a council leader.
“Without this, councils will continue to face difficult decisions around which vital provisions to fund, and which to reduce, to the detriment of their communities.”
One in five of local authorities have cut or compromised social care provision in the past 12 months, the survey found.
