According to a new poll of municipal councils, English councils are planning to offload social clubs, sports centres, and retail spaces as they bet on a rapid disposal of assets to stabilize finances.
Growing Fiscal Pressures Prompt Asset Sales
A coalition of councils representing major urban areas in the UK reported that 60% of councils are planning to dispose of properties to cover the rising costs of adult and children’s social care.
Councils have in the past faced criticism for disposing of playing fields and land to support their finances, but they argue they must proceed to raise vital cash from asset sales or face insolvency.
The group said that a significant number of councils seeking 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 utilising savings to manage growing fiscal pressures.”
Specific Examples of Proposed Disposals
One local authority in southeast England announced its asset disposal plan featured the sale of a retail complex in Rainham and a social club in another town to generate £20m over the next half-decade.
- A local golf course and business parks held in two English counties, which all provide rental income for the authority, will also be disposed of under the plan.
Council Tax Increases and Wider Financial Strains
The survey of local authorities in the key cities group, which includes several urban centers, further found that more than 70% of councils will need to increase local levies next spring to address the rising cost of essential services, higher levels of homelessness, and a longstanding accommodation deficit.
Medway council said it will press ahead with asset sales after steep rises in the cost of youth support, support for vulnerable learners, elderly and disability services, and temporary accommodation.
“We are taking innovative approaches but some of these take time to achieve both improved services and cost efficiency,” said a council leader.
He added: “There are population challenges which will continue to add to the strains we have. As a local government body, we had a drastic reduction in our central funding from 2010-24, which is extremely difficult.”
Countrywide Patterns and Forecasts
Research of regional authorities this week also found local finances being stretched by the growing number of children and older individuals requiring Send support.
The County Councils Network said that local shortfalls will hit 4.4 billion pounds a year by 2029, as they struggle to cope with increased demand.
Government officials have put off scheduled changes to the Send system until the coming year after a policy document setting out those changes was recently delayed.
Deprivation and Financial Gaps
Based on the latest deprivation measures (the Index of Multiple Deprivation) covering UK local authorities, several key cities members were included in the most deprived in the country.
- “Participating urban centers like Hull, Bradford, Stoke-on-Trent, Sunderland and Wolverhampton rank in the most deprived 30 across the country under the latest deprivation indices,” said the study.
“While only one key city is in the top 10 for deprived neighbourhoods countrywide, cities are far more likely to be in the most deprived fifth of the nation. The data underscores the scale of challenges confronting local leaders across major urban centers in the next twelve months,” the report added.
“Council officials have been explicit about the need for a fair and sustainable financial structure that reflects and responds to the actual extent of deprivation 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 detriment of their communities.”
A fifth of local authorities have reduced or weakened care services in the last year, the survey revealed.
