Based on a latest poll of local authorities, English councils are planning to sell community centers, sports centres, and shopping arcades as they rely on a fire sale of assets to balance the books.
Growing Fiscal Challenges Drive Asset Sales
The Key Cities Group for second-tier cities in the UK stated that six out of ten of local authorities are intending to sell assets to meet the rising costs of adult and children’s social care.
Local governments have previously faced criticism for selling public land and land to support their budgets, but they contend they must continue to generate essential revenue from property disposals or face insolvency.
The group said that a high proportion of authorities attempting to raise money from a fire sale of assets represented “a distinct shift from 2024, when the majority (six in ten) of municipal officials stated they would focus on restructuring services and using savings to manage increasing financial challenges.”
Specific Cases of Proposed Sales
Medway Council in southeast England announced its property management strategy featured the disposal of a shopping centre in Rainham and a social club in Rochester to generate £20m over the next half-decade.
- A local golf course and commercial properties held in Worcestershire and Suffolk, which all provide rental income for the authority, will also be disposed of under the strategy.
Local Levy Rises and Wider Fiscal Pressures
The survey of councils in the key cities group, which covers Sunderland, Southampton, Gloucester and Salford, also found that more than 70% of councils will need to raise local levies next spring to cover the rising cost of essential services, increased rates of housing insecurity, and a persistent housing shortage.
The authority said it will press ahead with asset sales after sharp increases in the cost of youth support, support for vulnerable learners, adult social care, and short-term housing.
“We are adopting innovative approaches but certain measures take time to achieve both improved services and financial savings,” stated a council leader.
He continued: “There are demographic pressures which will persist to increase the pressures we have. As a unitary authority, we had a 91% cut in our central funding from over the past decade, which is very challenging.”
National Trends and Projections
A survey of county councils recently also found council budgets being stretched by the growing number of children and adults needing Send support.
The County Councils Network projected that council deficits will hit 4.4 billion pounds a year by 2029, as they struggle to cope with rising needs.
Ministers have put off planned reforms to the Send system until next year after a white paper outlining those changes was recently delayed.
Deprivation and Funding Gaps
According to the latest deprivation measures (IMD) covering UK local authorities, several key cities members were among the most deprived in the country.
- “Participating urban centers like several major towns place in the most deprived 30 across the country under the 2025 deprivation indices,” noted the study.
“While only one key city is in the top 10 for disadvantaged communities countrywide, cities are far more likely to be in the most deprived fifth of the nation. The data highlights the extent of difficulties confronting municipal officials across major urban centers in the next twelve months,” the analysis added.
“Local government leaders have been explicit about the need for a fair and sustainable funding system that accounts for and responds to the actual extent of disadvantage and demand,” stated Michael Mordey.
“Without this, councils will continue to face difficult decisions around which vital provisions to allocate spend to, and which to reduce, to the detriment of their communities.”
A fifth of local authorities have reduced or weakened care services in the last year, the survey revealed.
