According to a latest survey of local authorities, English councils are preparing to offload community centers, sports centres, and retail spaces as they bet on a fire sale of assets to balance the books.
Growing Fiscal Pressures Drive Asset Sales
A coalition of councils for second-tier cities in England stated that six out of ten of councils are planning to dispose of properties to cover the rising costs of adult and children’s social care.
Councils have previously come under fire for selling public land 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 noted that a significant number of authorities seeking to generate funds from a fire sale of assets marked “a distinct shift from 2024, when the largest share (six in ten) of municipal officials said they would prioritise restructuring services and utilising savings to weather growing fiscal pressures.”
Detailed Cases of Proposed Sales
One local authority in Kent announced its asset disposal plan included the sale of a retail complex in a local town and a community venue in Rochester to generate £20m over the next half-decade.
- A local golf course and commercial properties held in Worcestershire and Suffolk, which all provide rental income for the authority, will also be sold under the plan.
Council Tax Rises and Wider Financial Strains
The survey of councils in the key cities group, which includes Sunderland, Southampton, Gloucester and Salford, further found that over seven in ten of authorities will have to increase local levies next spring to cover the growing cost of core provisions, higher levels of housing insecurity, and a persistent accommodation deficit.
Medway council said it will press ahead with property disposals after steep rises in the cost of children services, support for vulnerable learners, elderly and disability services, and temporary accommodation.
“We are taking creative strategies but some of these take time to deliver both better provisions and financial savings,” said Vince Maple.
He added: “We face population challenges which will continue to add to the pressures we have. As a local government body, we had a 91% cut in our central funding from over the past decade, which is extremely difficult.”
Countrywide Trends and Projections
A survey of county councils this week further found council budgets being stretched by the growing number of young people and adults requiring special educational assistance.
The County Councils Network said that local shortfalls will reach £4.4bn a year by the end of the decade, as they struggle to manage increased demand.
Government officials have put off planned reforms to the special educational needs framework until the coming year after a white paper setting out those changes has been postponed.
Deprivation and Funding Shortfalls
According to the latest deprivation measures (IMD) for UK local authorities, many participating urban areas were among the most deprived in England.
- “Member cities like several major towns place in the top 30 across the country under the latest IMD measures,” noted the study.
“Although only a single urban area is in the top 10 for disadvantaged communities nationally, urban areas are much more prone to be in the most deprived fifth of England. The figures underscores the extent of challenges facing municipal officials across key cities in the coming year,” the analysis concluded.
“Council officials have been explicit about the need for a equitable and lasting financial structure that reflects and addresses the real levels of deprivation and demand,” stated a council leader.
“Without this, local authorities will persist to face difficult decisions around which vital provisions to fund, and which to cut, to the detriment of their communities.”
One in five of local authorities have reduced or weakened social care provision in the last year, the survey found.
