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Based on a recent survey of local authorities, English councils are preparing to sell social clubs, athletic facilities, and retail spaces as they rely on a fire sale of assets to stabilize finances.

Growing Financial Pressures Prompt Asset Sales

A coalition of councils representing second-tier cities in the UK stated that 60% of local authorities are intending to dispose of properties to meet the escalating costs of adult and children’s social care.

Councils have in the past faced criticism for selling public land and open spaces to support their budgets, but they contend they must proceed to generate essential revenue from property disposals or face insolvency.

The group said that a high proportion of authorities seeking to generate funds from a quick sale of holdings marked “a clear change from 2024, when the largest share (60%) of municipal officials said they would focus on service redesigns and utilising savings to manage growing financial challenges.”

Detailed Examples of Planned Sales

Medway Council in southeast England announced its asset disposal plan featured the sale of a shopping centre in a local town and a social club in another town to raise £20m over the next half-decade.

• A local golf course and commercial properties owned in two English counties, which all generate rent for the authority, will also be disposed of under the plan.

Local Levy Rises and Wider Financial Pressures

The survey of local authorities in the key cities group, which covers several urban centers, further found that over seven in ten of authorities will have to raise council taxes next April to cover the growing cost of core provisions, increased rates of homelessness, and a persistent accommodation deficit.

The authority said it will press ahead with property disposals after sharp increases in the cost of youth support, support for vulnerable learners, elderly and disability services, and temporary accommodation.

“We are taking innovative approaches but certain measures take time to achieve both improved services and cost efficiency,” said a council leader.

He continued: “There are population challenges which will continue 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 very challenging.”

Countrywide Trends and Forecasts

Research of regional authorities recently further found local finances being stretched by the increasing figures of children and adults needing special educational assistance.

A network of councils projected that council deficits will reach £4.4bn a year by the end of the decade, as they struggle to manage increased demand.

Ministers have put off planned reforms to the Send system until next year after a policy document setting out those changes was recently delayed.

Deprivation and Financial Gaps

Based on the most recent deprivation measures (the Index of Multiple Deprivation) covering English councils, several key cities members were included in the most disadvantaged in the country.

• “Member cities like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton place in the top 30 across the country under the latest deprivation indices,” said the study.

“While only one key city is in the ten most deprived for disadvantaged communities countrywide, urban areas are much more prone to be in the worst-off 20% of the nation. The figures underscores the extent of difficulties facing local leaders across key cities in the next twelve months,” the report concluded.

“Local government leaders 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,” stated a council leader.

“Lacking this, local authorities will continue to face impossible choices around which essential services to allocate spend to, and which to reduce, to the detriment of their residents.”

A fifth of local authorities have reduced or weakened care services in the past 12 months, the study revealed.