According to a new survey of local authorities, UK councils are planning to offload community centers, sports centres, and shopping arcades as they rely on a fire sale of assets to balance the books.
Growing Financial Challenges Prompt Asset Sales
A coalition of councils for second-tier cities in England reported that 60% of local authorities are planning to dispose of properties to meet the escalating costs of social services for vulnerable individuals.
Local governments have in the past come under fire for selling public land and land to shore up their finances, but they argue they must continue to generate essential revenue from asset sales or declare themselves bankrupt.
The group said that a significant number of councils attempting to raise money from a quick sale of holdings represented “a distinct shift from 2024, when the largest share (60%) of local leaders stated they would prioritise service redesigns and utilising financial reserves to manage increasing financial challenges.”
Specific Examples of Proposed Sales
One local authority in Kent announced its property management strategy featured the disposal of a shopping centre in a local town and a social club in another town to generate 20 million pounds over five years.
- A local golf course and commercial properties held in Worcestershire and Suffolk, which all generate rent for Medway council, will also be sold under the strategy.
Council Tax Increases and Wider Fiscal Strains
This research of councils in the key cities group, which covers Sunderland, Southampton, Gloucester and Salford, further found that more than 70% of authorities will have to raise local levies next April to cover the rising cost of essential services, higher levels of homelessness, and a longstanding housing shortage.
The authority said it will proceed with asset sales after sharp increases in the cost of youth support, support for vulnerable learners, elderly and disability services, and temporary accommodation.
“We are adopting creative strategies but some of these take time to achieve both improved services and financial savings,” stated a council leader.
He added: “We face population challenges which will continue to increase the strains we have. As a local government body, we had a 91% cut in our central funding from 2010-24, which is extremely difficult.”
National Patterns and Forecasts
A survey of regional authorities this week also found council budgets being stretched by the increasing figures of children and adults requiring Send support.
The County Councils Network said that council deficits will reach £4.4bn a year by the end of the decade, as they grapple to cope with increased demand.
Government officials have delayed scheduled changes to the Send system until the coming year after a white paper outlining those reforms was recently delayed.
Disadvantage and Funding Gaps
Based on the most recent deprivation measures (IMD) covering UK local authorities, several participating urban areas were among the most disadvantaged in England.
- “Participating urban centers like several major towns place in the top 30 across the country under the 2025 IMD measures,” said the study.
“While only one key city is in the ten most deprived for disadvantaged communities nationally, cities are far more likely to be in the worst-off 20% of England. The figures underscores the extent of difficulties facing municipal officials across major urban centers in the coming year,” the report concluded.
“Local government leaders have been clear about the necessity for a fair and sustainable funding system that reflects and responds to the real levels of disadvantage and need,” stated a council leader.
“Lacking this, councils will persist to face impossible choices around which vital provisions to allocate spend to, and which to cut, to the disadvantage of their residents.”
One in five of local authorities have cut or compromised social care provision in the last year, the survey found.
