According to a new survey of municipal councils, UK councils are planning to offload community centers, athletic facilities, and shopping arcades as they rely on a fire sale of assets to balance the books.
Increasing Financial Challenges Prompt Asset Sales
The Key Cities Group for major urban areas in the UK reported that six out of ten of local authorities are intending to dispose of properties to meet the escalating costs of adult and children’s social care.
Local governments have in the past come under fire for disposing of playing fields and land to support their finances, but they argue they must proceed to raise vital cash from property disposals or declare themselves bankrupt.
This coalition said that a significant number of councils attempting to raise money from a fire sale of holdings represented “a distinct shift from 2024, when the majority (60%) of local leaders stated they would focus on service redesigns and using financial reserves to weather increasing financial challenges.”
Detailed Examples of Planned Sales
Medway Council in Kent said its property management strategy included the disposal of a shopping centre in a local town and a community venue in Rochester to raise £20m over five years.
- Gillingham golf club and business parks held in Worcestershire and Suffolk, which all generate rent for Medway council, will also be sold under the plan.
Council Tax Increases and Wider Fiscal Strains
This research of councils in the coalition, which includes Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of authorities will have to raise council taxes next April to cover the rising cost of essential services, increased rates of homelessness, and a persistent accommodation deficit.
Medway council said it will press ahead with asset sales after steep rises in the cost of youth support, special educational needs and disability (Send) provision, adult social care, and temporary accommodation.
“We are taking innovative approaches but certain measures require time to deliver both better provisions and financial savings,” said Vince Maple.
He continued: “We face demographic pressures which will continue to add to the pressures we have. As a unitary authority, we had a 91% cut in our revenue support grant from 2010-24, which is extremely difficult.”
Countrywide Patterns and Projections
A survey of county councils this week further found local finances being stretched by the increasing figures of young people and adults needing special educational assistance.
A network of councils said that local shortfalls will hit £4.4bn a year by the end of the decade, as they grapple to cope with increased demand.
Government officials have put off planned reforms to the special educational needs framework until next year after a policy document outlining those changes has been postponed.
Deprivation and Financial Shortfalls
According to the latest indices of deprivation (the Index of Multiple Deprivation) covering UK local authorities, many key cities members were among 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 2025 deprivation indices,” said the report.
“Although only one key city is among the top 10 for disadvantaged communities nationally, cities are much more prone to be in the worst-off 20% of England. The figures highlights the scale of challenges facing local leaders across key cities in the next twelve months,” the report concluded.
“Council officials have been clear about the necessity for a equitable and lasting financial structure that accounts for and responds to the real levels of deprivation and demand,” said a council leader.
“Without this, councils will persist to face difficult decisions around which vital provisions to allocate spend to, and which to cut, to the disadvantage of their residents.”
One in five of councils have cut or compromised social care provision in the past 12 months, the survey revealed.
