Based on a latest survey of local authorities, English councils are planning to offload community centers, athletic facilities, and retail spaces as they bet on a fire sale of properties to stabilize finances.
Growing Financial Challenges Drive Asset Sales
The Key Cities Group representing second-tier cities in England reported that 60% of councils are intending to sell assets to meet the rising costs of social services for vulnerable individuals.
Councils have previously come under fire for disposing of public land and land to support their finances, but they argue they must continue to raise vital cash from property disposals or face insolvency.
This coalition said that a high proportion of authorities seeking to raise money from a quick sale of holdings marked “a clear change from 2024, when the largest share (60%) of local leaders said they would prioritise restructuring services and utilising financial reserves to weather growing fiscal pressures.”
Detailed Cases of Proposed Disposals
One local authority in Kent announced its property management strategy featured the sale of a shopping centre in Rainham and a social club in Rochester to raise £20m over the next half-decade.
- Gillingham golf club and business parks owned in two English counties, which all provide rental income for the authority, will also be disposed of under the strategy.
Local Levy Increases and Wider Fiscal Pressures
The survey of councils in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, also found that more than 70% of authorities will need to increase council taxes next spring to cover the growing cost of core provisions, increased rates of homelessness, and a longstanding accommodation deficit.
Medway council explained it will press ahead with asset sales after sharp increases in the cost of children services, support for vulnerable learners, adult social care, and temporary accommodation.
“We are adopting creative strategies but certain measures require time to achieve both improved services and financial savings,” said a council leader.
He added: “There are 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 2010-24, which is extremely difficult.”
National Trends and Forecasts
Research of county councils recently also found local finances being stretched by the increasing figures of young people and adults requiring Send support.
The County Councils Network said that local shortfalls will reach £4.4bn a year by 2029, as they grapple to manage increased demand.
Government officials have delayed scheduled changes to the Send system until the coming year after a white paper setting out those changes was recently delayed.
Disadvantage and Financial Gaps
Based on the most recent indices of deprivation (IMD) for English councils, many participating urban areas were among the most deprived in the country.
- “Participating urban centers like several major towns rank in the most deprived 30 across the country under the latest deprivation indices,” said the report.
“While only a single urban area is in the ten most deprived for disadvantaged communities nationally, urban areas are far more likely to be in the most deprived fifth of England. The data highlights the extent of difficulties confronting municipal officials across key cities in the coming year,” the report added.
“Council officials have been explicit about the necessity for a equitable and lasting funding system that reflects and responds to the real levels of deprivation and need,” stated Michael Mordey.
“Lacking this, councils will continue to face difficult decisions around which essential services to fund, and which to cut, to the detriment of their residents.”
A fifth of councils have cut or compromised care services in the last year, the study found.
