According to a new study of local authorities, English councils are planning to offload social clubs, sports centres, and retail spaces as they bet on a rapid disposal of assets to balance the books.
Growing Financial Pressures Prompt Asset Sales
A coalition of councils for second-tier cities in the UK reported that 60% of councils are planning to dispose of properties to meet the escalating costs of social services for vulnerable individuals.
Councils have in the past faced criticism for disposing of playing fields and open spaces to support their budgets, but they contend they must proceed to raise vital cash from asset sales or declare themselves bankrupt.
This coalition noted that a high proportion of authorities seeking to raise money from a quick sale of holdings represented “a distinct shift from 2024, when the majority (60%) of local leaders stated they would focus on service redesigns and utilising savings to weather increasing fiscal pressures.”
Detailed Examples of Planned Sales
Medway Council in southeast England said its property management strategy included the disposal of a shopping centre in Rainham and a community venue in another town to generate £20m over five years.
- Gillingham golf club and business parks owned in Worcestershire and Suffolk, which all generate rent for the authority, will also be disposed of under the plan.
Local Levy Rises and Broader Fiscal Strains
The survey of councils in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, also found that over seven in ten of authorities will have to raise local levies next spring to cover the rising cost of essential services, increased rates of homelessness, and a persistent accommodation deficit.
The authority said it will press ahead with property disposals after sharp increases in the cost of children services, support for vulnerable learners, adult social care, and temporary accommodation.
“We are adopting creative strategies but some of these require time to deliver both improved services and financial savings,” said Vince Maple.
He added: “We face demographic pressures which will continue to increase the pressures we have. As a unitary authority, we had a drastic reduction in our central funding from 2010-24, which is very challenging.”
National Trends and Projections
A survey of county councils this week further found local finances being stretched by the growing number of young people and older individuals needing Send support.
The County Councils Network said that local shortfalls will hit £4.4bn a year by the end of the decade, as they grapple to cope with increased demand.
Government officials have put off planned reforms to the special educational needs framework until the coming year after a policy document outlining those reforms was recently delayed.
Deprivation and Funding Gaps
According to the most recent indices of deprivation (IMD) for UK local authorities, several participating urban areas were included in the most deprived in England.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the most deprived 30 across the country under the latest deprivation indices,” said the report.
“Although only a single urban area is among the top 10 for disadvantaged communities nationally, cities are much more prone to be in the worst-off 20% of England. The figures highlights the scale of challenges confronting municipal officials across major urban centers in the next twelve months,” the analysis added.
“Local government leaders have been clear about the need for a equitable and lasting financial structure that reflects and responds to the actual extent of disadvantage and need,” said Michael Mordey.
“Without this, councils will persist to face difficult decisions around which vital provisions to fund, and which to cut, to the detriment of their residents.”
A fifth of councils have reduced or weakened social care provision in the last year, the survey revealed.
