Based on a new study of local authorities, English councils are planning to offload social clubs, sports centres, and shopping arcades as they rely on a rapid disposal of assets to stabilize finances.
Growing Fiscal Pressures Prompt Asset Sales
The Key Cities Group representing major urban areas in the UK reported that 60% of local authorities are planning to sell assets to cover the rising costs of adult and children’s social care.
Councils have previously come under fire for selling public land and land to shore up their budgets, but they argue they must continue to generate essential revenue from property disposals or declare themselves bankrupt.
The group said that a significant number of authorities seeking to raise money from a quick sale of assets represented “a distinct shift from 2024, when the largest share (six in ten) of local leaders said they would focus on restructuring services and utilising savings to weather growing financial challenges.”
Specific Examples of Proposed Disposals
Medway Council in southeast England said its property management strategy featured the disposal of a retail complex in a local town and a social club in another town to generate £20m over the next half-decade.
- A local golf course and business parks held in Worcestershire and Suffolk, which all generate rent for Medway council, will additionally be disposed of under the strategy.
Council Tax Increases and Broader Financial Strains
This research of local authorities in the key cities group, which includes several urban centers, also found that more than 70% of councils will need to raise local levies next April to cover the growing cost of essential services, increased rates of homelessness, and a longstanding accommodation deficit.
Medway council 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 short-term housing.
“We are taking innovative approaches but certain measures require time to achieve both improved services and cost efficiency,” said a council leader.
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 revenue support grant from 2010-24, which is extremely difficult.”
National Patterns and Forecasts
A survey of regional authorities recently further found council budgets being strained by the growing number of young people and adults requiring special educational assistance.
A network of councils projected that council deficits will hit £4.4bn a year by the end of the decade, as they grapple to cope with rising needs.
Ministers have delayed planned reforms to the special educational needs framework until next year after a white paper setting out those reforms was recently delayed.
Deprivation and Financial Shortfalls
According to the most recent indices of deprivation (the Index of Multiple Deprivation) for English councils, many participating urban areas were among the most deprived in England.
- “Member cities like several major towns rank in the most deprived 30 nationally under the 2025 IMD measures,” noted the study.
“Although only one key city is among the ten most deprived for disadvantaged communities countrywide, cities are much more prone to be in the worst-off 20% of the nation. The data highlights the extent of difficulties confronting local leaders across key cities in the coming year,” the report concluded.
“Local government leaders have been clear about the need for a fair and sustainable financial structure that reflects and addresses the actual extent of deprivation and demand,” said a council leader.
“Lacking this, local authorities will persist to face impossible choices around which essential services to fund, and which to reduce, to the disadvantage of their residents.”
One in five of local authorities have cut or compromised care services in the past 12 months, the study found.
