Based on a new poll of municipal councils, UK councils are preparing to offload community centers, sports centres, and shopping arcades as they rely on a fire sale of assets to balance the books.
Growing Fiscal Pressures Drive Asset Sales
A coalition of councils representing second-tier cities in England reported that six out of ten of local authorities are intending to sell assets to cover the rising costs of adult and children’s social care.
Councils have in the past come under fire for selling public land and land to shore up their budgets, but they contend they must continue to raise vital cash from asset sales or face insolvency.
This coalition said that a significant number of authorities attempting to raise money from a fire sale of holdings marked “a distinct shift from 2024, when the largest share (six in ten) of municipal officials stated they would focus on restructuring services and using savings to weather increasing financial challenges.”
Detailed Examples of Proposed Disposals
One local authority in Kent announced its asset disposal plan included the sale of a retail complex in Rainham and a community venue in Rochester to raise £20m over five years.
- A local golf course and business parks held in two English counties, which all generate rent for Medway council, will also be disposed of under the strategy.
Council Tax Increases and Wider Fiscal Pressures
The survey of councils in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of authorities will have to raise local levies next spring to address the growing cost of essential services, higher levels of homelessness, and a longstanding accommodation deficit.
The authority said it will press ahead with property disposals after sharp increases in the cost of children services, special educational needs and disability (Send) provision, adult social care, and temporary accommodation.
“We are adopting creative strategies but certain measures take time to deliver both better provisions and cost efficiency,” stated a council leader.
He continued: “We face population challenges which will persist to increase the pressures we have. As a unitary authority, we had a drastic reduction in our revenue support grant from over the past decade, which is extremely difficult.”
National Trends and Projections
Research of regional authorities this week also found local finances being stretched by the increasing figures of young people and older individuals needing special educational assistance.
A network of councils projected that council deficits will reach £4.4bn a year by 2029, as they struggle to cope with increased demand.
Government officials have put off planned reforms to the Send system until next year after a white paper outlining those reforms was recently delayed.
Deprivation and Financial Shortfalls
Based on the most recent deprivation measures (IMD) for English councils, several participating urban areas were among the most disadvantaged in England.
- “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the most deprived 30 across the country under the 2025 deprivation indices,” noted the study.
“Although only a single urban area is among the top 10 for disadvantaged communities countrywide, cities are much more prone to be in the most deprived fifth of the nation. The data highlights the extent of challenges confronting municipal officials across major urban centers in the coming year,” the report added.
“Council officials have been explicit about the necessity for a fair and sustainable funding system that reflects and responds to the actual extent of deprivation and demand,” said Michael Mordey.
“Without this, local authorities will persist to face difficult decisions around which essential services to fund, and which to reduce, to the disadvantage of their communities.”
A fifth of local authorities have cut or compromised care services in the past 12 months, the survey found.
