According to a new poll of municipal councils, UK councils are planning to sell social clubs, athletic facilities, and retail spaces as they rely on a rapid disposal of assets to balance the books.
Increasing Fiscal Pressures Drive Asset Sales
A coalition of councils representing major urban areas in the UK reported that 60% of local authorities are intending to sell assets to meet the rising costs of adult and children’s social care.
Councils have previously come under fire for disposing of public land and open spaces to shore up their budgets, but they argue they must proceed to generate essential revenue from asset sales or declare themselves bankrupt.
This coalition noted that a significant number of councils seeking to generate funds from a fire sale of holdings represented “a clear change from 2024, when the largest share (six in ten) of municipal officials stated they would focus on service redesigns and using financial reserves to manage increasing financial challenges.”
Specific Cases of Proposed Sales
One local authority in Kent said its property management strategy included the sale of a shopping centre in Rainham and a community venue in Rochester to raise 20 million pounds over five years.
- Gillingham golf club and commercial properties held in two English counties, which all generate rent for Medway council, will also be sold under the plan.
Council Tax Rises and Broader Financial Pressures
The survey of councils in the key cities group, which covers several urban centers, also found that over seven in ten of authorities will have to increase council taxes next spring to cover the rising cost of core provisions, higher levels of homelessness, and a longstanding accommodation deficit.
Medway council said it will press ahead with property disposals after steep rises in the cost of youth support, support for vulnerable learners, adult social care, and temporary accommodation.
“We are adopting creative strategies but certain measures take time to deliver both better provisions and financial savings,” stated a council leader.
He continued: “There are population challenges which will persist to increase the pressures we have. As a local government body, we had a 91% cut in our central funding from over the past decade, which is extremely difficult.”
Countrywide Trends and Forecasts
Research of county councils this week further found council budgets being strained by the growing number of young people and older individuals requiring Send support.
A network of councils projected that local shortfalls will hit 4.4 billion pounds a year by 2029, as they struggle to manage increased demand.
Ministers have delayed planned reforms to the special educational needs framework until the coming year after a policy document setting out those reforms has been postponed.
Disadvantage and Financial Shortfalls
Based on the latest indices of deprivation (IMD) for UK local authorities, many participating urban areas were among the most disadvantaged in England.
- “Member cities like several major towns place in the top 30 nationally under the latest deprivation indices,” said the report.
“While only one key city is in the top 10 for deprived neighbourhoods nationally, cities are much more prone to be in the worst-off 20% of England. The data highlights the scale of difficulties facing municipal officials across key cities in the coming year,” the report added.
“Council officials have been explicit about the need for a equitable and lasting funding system that accounts for and responds to the real levels of deprivation and need,” stated Michael Mordey.
“Without this, local authorities will persist to face impossible choices around which essential services to allocate spend to, and which to cut, to the detriment of their residents.”
A fifth of local authorities have reduced or weakened social care provision in the past 12 months, the survey revealed.
