According to a recent survey of municipal councils, UK councils are preparing to sell social clubs, sports centres, and retail spaces as they rely on a fire sale of assets to balance the books.
Growing Fiscal Challenges Drive Asset Sales
A coalition of councils representing major urban areas in the UK reported that six out of ten of councils are intending to sell assets to cover the rising costs of social services for vulnerable individuals.
Local governments have previously faced criticism for disposing of playing fields and open spaces to support their budgets, but they contend they must continue to generate essential revenue from property disposals or declare themselves bankrupt.
The group said that a high proportion of councils attempting to raise money from a quick sale of assets represented “a distinct shift from 2024, when the majority (60%) of local leaders said they would prioritise service redesigns and using financial reserves to manage growing financial challenges.”
Specific Examples of Proposed Sales
Medway Council in Kent said its property management strategy featured the disposal of a shopping centre in a local town and a community venue in Rochester to raise 20 million pounds over five years.
- A local golf course and commercial properties held in two English counties, which all generate rent for the authority, will additionally be disposed of under the plan.
Local Levy Rises and Wider Fiscal Strains
The survey of local authorities in the key cities group, which covers Sunderland, Southampton, Gloucester and Salford, also found that more than 70% of authorities will need to increase local levies next spring to cover the rising cost of core provisions, higher levels of housing insecurity, and a longstanding housing shortage.
The authority explained it will proceed with asset sales after sharp increases in the cost of children services, special educational needs and disability (Send) provision, adult social care, and short-term housing.
“We are taking innovative approaches but some of these require time to deliver both improved services and financial savings,” said Vince Maple.
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 revenue support grant from 2010-24, which is extremely difficult.”
Countrywide Trends and Projections
Research of regional authorities recently further found local finances being strained by the growing number of young people and older individuals needing Send support.
A network of councils said that local shortfalls will reach £4.4bn a year by 2029, as they struggle to manage increased demand.
Ministers have delayed planned reforms to the special educational needs framework until next year after a white paper outlining those changes was recently delayed.
Disadvantage and Funding Shortfalls
Based on the latest deprivation measures (IMD) covering English councils, several key cities members were among the most disadvantaged in the country.
- “Member cities like several major towns place in the most deprived 30 nationally under the 2025 IMD measures,” noted the study.
“Although only one key city is among the top 10 for deprived neighbourhoods nationally, cities are much more prone to be in the most deprived fifth of England. The data highlights the scale of difficulties facing municipal officials across major urban centers in the next twelve months,” the analysis 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 disadvantage and demand,” stated Michael Mordey.
“Lacking this, local authorities will continue to face difficult decisions around which vital provisions to fund, and which to reduce, to the disadvantage of their residents.”
A fifth of local authorities have cut or compromised social care provision in the last year, the study revealed.
