Based on a new study of municipal councils, English councils are planning to offload community centers, sports centres, and shopping arcades as they bet on a rapid disposal of properties to balance the books.
Increasing Fiscal Challenges Drive Asset Sales
The Key Cities Group for second-tier cities in England stated that six out of ten of local authorities are intending to dispose of properties to meet the rising costs of social services for vulnerable individuals.
Local governments have previously faced criticism for selling public land and land to shore up their budgets, but they argue they must continue to generate essential revenue from asset sales or face insolvency.
The group noted that a significant number of councils attempting to generate funds from a quick sale of assets represented “a distinct shift from 2024, when the majority (60%) of municipal officials said they would focus on service redesigns and using savings to weather increasing financial challenges.”
Specific Examples of Planned Disposals
Medway Council in Kent announced its asset disposal plan featured the sale of a retail complex in Rainham and a community venue in another town to generate £20m over the next half-decade.
- Gillingham golf club and business parks held in two English counties, which all generate rent for the authority, will also be sold under the plan.
Council Tax Increases and Wider Fiscal Pressures
This research of councils in the coalition, which covers Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of councils will need to increase council taxes next April to cover the growing cost of essential services, higher levels of homelessness, and a longstanding housing shortage.
Medway council explained it will proceed 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 creative strategies but some of these require time to deliver both improved services and cost efficiency,” stated Vince Maple.
He added: “We face population challenges which will continue to add to the strains we have. As a unitary authority, we had a drastic reduction in our revenue support grant from over the past decade, which is very challenging.”
Countrywide Trends and Forecasts
Research of county councils this week further found council budgets being stretched by the growing number of young people and adults requiring Send support.
The County Councils Network projected that local shortfalls will reach 4.4 billion pounds a year by 2029, as they struggle to manage rising needs.
Ministers have put off scheduled changes to the special educational needs framework until next year after a white paper outlining those changes has been postponed.
Disadvantage and Financial Shortfalls
According to the most recent deprivation measures (IMD) for 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 top 30 nationally under the 2025 IMD measures,” said the report.
“While only a single urban area is among the ten most deprived for deprived neighbourhoods nationally, cities are much more prone to be in the worst-off 20% of the nation. The figures underscores the scale of difficulties confronting municipal officials across major urban centers in the next twelve months,” the report added.
“Local government leaders have been explicit about the necessity for a equitable and lasting funding system that reflects and addresses the real levels of deprivation and need,” stated Michael Mordey.
“Without this, local authorities will continue to face impossible choices around which vital provisions to allocate spend to, and which to cut, to the detriment of their residents.”
A fifth of local authorities have reduced or weakened care services in the last year, the study revealed.
