According to a new poll of municipal councils, English councils are preparing to sell community centers, sports centres, and shopping arcades as they bet on a rapid disposal of assets to balance the books.
Growing Financial Challenges Drive Asset Sales
The Key Cities Group representing second-tier cities in the UK stated that 60% of local authorities are intending to dispose of properties to cover the escalating costs of adult and children’s social care.
Local governments have previously faced criticism for disposing of public land and land to support their budgets, but they argue they must proceed to raise vital cash from property disposals or declare themselves bankrupt.
The group said that a significant number of authorities seeking to generate funds from a fire sale of assets marked “a distinct shift from 2024, when the largest share (60%) of local leaders stated they would focus on restructuring services and utilising financial reserves to manage increasing financial challenges.”
Specific Examples of Proposed Sales
Medway Council in Kent said its asset disposal plan included the sale of a shopping centre in a local town and a community venue in another town to generate £20m over five years.
- A local golf course and business parks held in Worcestershire and Suffolk, which all generate rent for Medway council, will also be sold under the plan.
Council Tax Rises and Wider Fiscal Pressures
This research of councils in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of councils will need to increase local levies next spring to cover the growing cost of essential services, increased rates of homelessness, and a persistent accommodation deficit.
The authority said it will press ahead with asset sales after steep rises in the cost of children services, support for vulnerable learners, elderly and disability services, and temporary accommodation.
“We are adopting innovative approaches but certain measures take time to achieve both better provisions and cost efficiency,” said Vince Maple.
He continued: “We face demographic pressures which will persist to add to the strains we have. As a local government body, 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 recently further found council budgets being strained by the growing number of children and older individuals requiring special educational assistance.
A network of councils projected that council deficits will reach £4.4bn a year by the end of the decade, as they struggle to cope with increased demand.
Ministers have put off scheduled changes to the Send system until next year after a white paper setting out those reforms has been postponed.
Deprivation and Financial Shortfalls
According to the latest deprivation measures (the Index of Multiple Deprivation) for UK local authorities, several key cities members were among the most deprived in England.
- “Member cities like several major towns rank in the most deprived 30 across the country under the 2025 deprivation indices,” noted the study.
“While only a single urban area is among the top 10 for deprived neighbourhoods countrywide, urban areas are far more likely to be in the worst-off 20% of England. The data underscores the scale of difficulties facing municipal officials across key cities in the next twelve months,” the analysis added.
“Local government leaders have been clear about the necessity for a equitable and lasting funding system that reflects and addresses the real levels of deprivation and demand,” said Michael Mordey.
“Lacking this, local authorities will persist to face impossible choices around which essential services to fund, and which to cut, to the disadvantage of their residents.”
A fifth of councils have reduced or weakened care services in the last year, the survey revealed.
